THE  LIBRARY 


THE  UNIVERSITY 


OF  CALIFORNIA 


GIFT  OF 

Dr.   Gorcbn  Vatkins 


PERSONNEL  RELATIONS 
IN  INDUSTRY 


By 

Xe0          sti* 

A/ M.  SIMONS 

Atjthor   of   "  Social   Forces  in  American  History."     Formerly 
Lecturer  on  Personnel  Relations  in  the  Extension  Department 
of    the    University    of    Wisconsin,    and     Manager    Personnel 
Department,   Leffingwell-Ream  Company. 


NEW  YORK 

THE  RONALD  PRESS  COMPANY 
1921 


Copyright,  1921,  by 
THE  RONALD  PRESS  COMPANY 


All  Rights  Reserved 


PREFACE 

The  years  of  war  and  readjustment  have  brought  a  new 
conception  of  the  "labor  problem"  in  nearly  all  industrial 
nations.  Old  theories  of  repression,  on  one  side,  and  doctrines 
of  sudden  millennial  conquest,  upon  the  other,  are  giving  way 
before  a  clearei  realization  of  facts.  The  change  is  due  in 
part  to  a  multitude  of  enlightening  experiences  with  the  actual 
adjustment  of  complicated  industrial  situations;  but  not  less 
to  the  definite  study  of  processes  and  relations  within  the 
field  of  industry  itself,  and  to  rapid  developments  in  the  allied 
fields  of  psychology,  sociology,  economics,  and  indus- 
trial hygiene.  The  new  interest  in  industrial  relations 
has  developed  already  an  extensive  literature.  It  is  less 
concerned  than  that  of  earlier  times  with  dreams  and  hopes, 
or  with  contending  industrial  theories,  and  more  with  records 
of  actual  human  contact,  in  shop,  mill,  mine,  factory,  and 
store,  and  with  experiments  in  adjusting  human  relations. 

Multitudes  of  facts  available  for  study  are  already  being 
classified,  and  where  continuous  sequences  of  reactions  have 
appeared,  scientific  laws  have  been  laid  bare.  That  these 
laws  should  be  put  to  everyday  use  in  order  to  eliminate  the 
waste  of  "trial  and  error"  is  most  important. 

The  present  book  aims  to  further  the  process  of  classifica- 
tion by  pointing  out  some  of  the  scientific  laws  which  have 
actually  been  brought  to  light.  Only  the  general  principles 
which  under  careful  scrutiny  seemed  reliable — when  dealing 
with  such  changing  quantities  as  human  beings — have  been 
noted.  No  effort  has  been  made  to  refer  to  every  individual 
instance  of  the  tendencies  and  principles  discussed,  as  such 
illustrations  may  be  found  in  great  variety  in  other  books. 


iv  PREFACE 

In  one  other  respect  the  plan  of  this  book  differs  from 
that  of  many  others.  "Human  nature"  has  been  made  its 
basic  characteristic,  because  that  factor  runs  uniformly 
through  all  industrial  problems.  Industry  exists  only  for,  by, 
and  through  human  beings  and  their  relations.  As  far  as  pos- 
sible every  industrial  problem  has  been  analyzed  to  determine 
the  reactions  of  human  nature  to  the  conditions  presented. 

The  material  here  set  forth  represents  many  years  of  work. 
It  was  first  organized  for  presentation  to  classes  of  the  Exten- 
sion Department  of  the  University  of  Wisconsin,  the  attend- 
ants at  which  were  nearly  all  executives  actively  engaged  in 
industrial  management — most  of  them  directing  some  form 
of  personnel  work.  There  was  the  greatest  possible  freedom 
of  discussion,  and  every  proposal  was  subjected  to  expert 
criticism  as  well  as  to  actual  test  in  industrial  practice.  The 
work  was  later  entirely  rewritten.  Specialists  were  consulted, 
industrial  plants  were  visited,  and  every  effort  was  made  to 
insure  accuracy  as  to  facts,  and  conservatism  as  to  conclusions. 
Thanks  are  especially  due  to  Professor  Earl  Dean  Howard, 
Labor  Manager  of  Hart,  Schaffner  and  Marx,  who  read  and 
criticized  the  manuscript  of  the  chapters  on  democracy  in 
industry. 

Participation,  for  nearly  a  quarter  of  a  century,  in  nearly 
all  phases  of  the  labor  movement  leads  the  author  to  believe 
that  the  contribution  of  our  age  to  the  ever-present  problem 
of  labor  is  the  discovery  and  application  thereto  of  scientific 
methods  of  analysis,  already  applied  to  so  many  other  fields 
of  human  thought  and  activity.  Whatever  the  future  may 
hold,  whatever  changes  it  may  bring  to  industrial  relations, 
the  knowledge  gained  by  scientific  methods  must  remain  the 
only  safe  guide  to  action. 

A.  M.  SIMONS. 
Evanston,  Illinois, 

March  8,  1921. 


CONTENTS 


CHAPTER                                                                                          PAGE 
I    THE   CHANGING  VIEWPOINT 3 

The  Functionalization  of  Social  Institutions 
Production  the  Function  of  Industry 
Personnel  Relations  and  Production 
Scientific  Approach  to  Industry 
Law  of  Unequal  Advance 
Availability  of  Scientific  Knowledge 
Limitations  of  Individual  Experience 
Scientific  Methods  in  Industry 
The  Superman  Rarely  Available 
Science  and  Financial  Control 
Science  as  an  Aid  to  Purchasing 
Application  of  Science  to  Management 
Application  of  Science  to  Personnel  Relations 
The  Field  of  Personnel  Relations 
Economy  of  Time  and  Effort 
Contributions  of  the  Older  Sciences 

II     STANDARDIZATION  OF  EMPLOYMENT  ELEMENTS — THE  JOB     19 

Standards  and  Civilization 

Definition  of  "Standards" 

Applying  Standards  in  Manufacture 

The  Elements  of  Personnel  Relations 

Job  Survey 

Job  Analysis 

Points  Covered  by  Job  Analysis 

Value  of  a  Job  Analysis 

Influence  on  Employment  or  Personnel  Work 

Job  Specification 

Job  Standardization  on  National   Scale 

III     STANDARDIZING  THE  ELEMENTS — HUMAN  NATURE    .    .    33 

Two  Phases  of  the  Personnel   Problem 

Psychology  Applied  to  Industrial  Relations 

The  Elements  of  Human  Nature 

The  Instincts 

The  Origin  of  Instincts 

Functions  and  Laws  of  Operation 

Slowness  of  Change  in  Instincts 

Influence  of   Method  of   Change 

Directing  Instinctive  Energy 

Instincts  that  Bear  Upon  Industry 

Suppression  of  the  Instinct  of  Craftsmanship 


vi  CONTENTS 

CHAPTER                                                                                          PAGE 
IV    SOURCES   OF    LABOR    SUPPLY 45 

Standardization  of  Money  and  Materials 
The  Labor  Supply  Not  Yet  Standardized 
A  Cross-Section  of  Labor  Supply 
Classification  of  Labor  by  Locality 
Neighborhood  Surveys 
Present  Methods  of  Securing  Labor 
Public  Employment  Offices 
Formation  of  Labor  Reserve 
Plans  for  Recruiting  Labor 
Natural  Sources  of  Labor  Supply 
Necessity  for  Vocational  Guidance 
Supervising  the  Worker's  Progress 

V    APPLICATION  BLANK — REFERENCES — INTERVIEWING    .    .    60 

Individual  Adjustment  to   Industry 
Basis  of  Proper  Adjustment 
Application  Blanks,  Old  and  New 
The  Futility  of  "Character  Analysis" 
Uselessness  of  Certain  Queries 
Essential  Queries 

Standard  for  Evaluating  References 
Interviewing  the  Applicant 
The  Pseudo-Science  of  Physiognomy 
Methods  of  Physiognomy  Fakers 
Character  Reading  versus  Facts 
Requisites  for  Successful  Interviewing 
Necessity  of  Physical  Examination 
Advantages  of  Physical  Examination 

VI    MENTAL   AND   TRADE   TESTS 75 

Testing  Ability  by  Trial  and  Error 

Need  for  Accurate  «Tests 

Psychological  Measurement  of  Ability 

The  Old  Psychology 

The  New  Psychology 

Evolution  of  Mental  Tests 

The  Binet- Simon  Tests 

Tests  Established  for  Normal  Children 

Methods  of  Applying  Tests 

Grading  Rather  Than   Measurement 

Definition  of  Intelligence 

Industrial  and  Educational  Methods  Compared 

Extension  of  Use  to  Higher  Educational  Work 

The  United  States  Army  Tests 

Application  of  Tests  to  Industry 

Measurement  of   Concentration 

Measurement  of   Trade  Ability 

Requirements  of  Trade  Tests 

Preparation  of  Army  Tests 

Classification  of  Trade  Skill 


CONTENTS  vii 

CHAPTER  PAGE 

Performance  Tests 

Development  of  Industrial  Trade  Tests 
National  Standard  Intelligence  Tests 
Future  Developments 

VII    INTRODUCING  THE  NEW  EMPLOYEE 103 

Group  Instinct 

Significance  of  the  Group   Instinct 

The  Law  of  Learning 

Effect  of  Incentives  on  Rate  of  Learning 

Discomfort  During  Adjustment  Period 

Facilitating  Adjustment 

Matters  to  be  Explained 

Book  of  Rules  and  Policies 

Preparation  of  the  Booklet 

Steps  in  Initiation 

Introduction  During  Instruction  Period 

Outside  and  Home  Influences 

VIII    INTERESTING  LABOR   IN   INDUSTRY 114 

The  Worker's  Loss  of  Interest 

Dangers  of  Indifference 

Value  of  Industrial  Good-will 

Reasons  for  Absence  of  Good-will 

Instinctive  Desire  to  Work 

Pleasure  Through  Gratification  of  Instincts 

Need  of  Restoring  Pleasure  in  Production 

Methods  of  Arousing  Interest 

Educational  Work 

Selling  the  House  Policies 

Subsequent  Value  of  Explanatory  Work 

Integrating  the  Worker  with  Industry 

Restoring  Power  to  Gratify  Instincts 

Disappearance  of  Initiative  Among  Workmen 

A  Deficiency  of  the  Taylor  System 

Labor's  Antagonism  to  the  Taylor  System 

Affording  Opportunities  for  Original  Work 

Democratic  Planning — The  New  Spirit 

Effect  of  Democratic  Planning 

Craft  Spirit  and  Quality 

Industrial  Leadership 

Difficulties  in  Applying  Principles 

IX    TRAINING 137 

Productive  Machinery  versus  Productive  Skill 
Destruction   of   Craftsmanship 
Mental  Demands  of  Middle  Ages 
Mental  Demands  of  Modern  Times 
The  Basis  of  Continuing  Progress 
Deficiencies  of  Present-Day  Education 
Education  for  Life  Work 


viii  CONTENTS 

CHAPTER  PAGE 

Necessity  for  Plant  Training 
Character  of  Plant  Training 
Training  Younger  Workers 
Training  Adults 

Organization  of  Training  System 
The  Foreman's  Place  in  the  Training  Scheme 
Training  Conferences  for  Foremen 
Possibilities  of  Industrial  Training 
Effect  on  Labor  and  Production 
Effect  on  Mental  Ability 

X    ADJUSTMENTS,   TRANSFERS,   PROMOTIONS,   DISCHARGE    .  155 

Basing  Adjustments  on  Records 

Elements  Involved  in  Transfers  and  Promotions 

Rating  Employees  for  Promotion 

Simplified  System  of  Rating 

Checking  Ratings 

Location  and  Use  of  Records 

Basis  of  Transfers  and  Promotions 

Rating  Emotions 

Planning  for  Promotion 

Objection  to  Promotion  Plan 

Training  System  and  Monotony 

Need  for  Regular  Promotion 

Complaints  and  Arbitration  Machinery 

Discharges  and  Resignations 

XI    WORKING  ENVIRONMENT — WELFARE  WORK 171 

Essentials  Before  Frills 

Working  Conditions  and  Fatigue 

Light,  Heat,  and  Ventilation 

Noise  and  Accidents 

Plant  Environment  and  Artistic  Sense 

Overwork  and  Nervous  Strain 

The  Laws  of  Fatigue 

Cause  of  Fatigue 

Rhythm  of  Work  and  Rest 

The  Organization  of  Amusement 

Care  for  Health 

The  Industrial  Physician 

Essentials  of  Plant  Hygiene 

Health  and  Life  Insurance 

Restaurants  and  Other  Facilities 

The  Housing  Problem 

Co-operative  Buying 

Future  Field  of  Welfare  Work 

XII    THE    WAGE    RELATION 192 

Fossilized  Wage  Theories 
Theory  of  Marginal  Utility 
Wages  and  Standards  of  Living 


CONTENTS  ix 

CHAPTER  PAGE 

Standard  Minimum  Budget 

High  Cost  of  Low  Wages 

High  Wages  and  Efficiency 

High  Wages  and  Prosperity 

Wages  and  Piece-Rates 

Objection  to  Payment  by  Results 

Standards  for  Wage  Determination 

Management  versus  Employee  Efficiency 

Scientific  Management  and  Production  Cost 

Time  and  Motion  Study 

Efficiency  versus  Strenuousness 

Base  Rate  and  Bonus  Systems 

Emphasis  on  Quality  Production 

Profit-Sharing  Plans 

XIII  LABOR    TURNOVER 214 

Turnover  as  an  Efficiency  Barometer 

Methods  of  Calculating  Labor  Turnover 

Form  for  Analysis  of  Problem 

Relation  of  Length  of  Service  to  Turnover 

Problem  of  Unskilled  Labor 

Danger  of  Illiteracy 

Turnover  of  Youthful  Labor 

Remedy  for  Youthful  Turnover 

Further  Analysis  of  Problem 

Maladjustment  of  Instincts  to  Environment 

Effect  of  Interest  in  Work  on  Turnover 

Cost  of  Labor  Turnover 

Wastes  of  Turnover 

Industries  with  Low  Turnover 

Means  of  Reducing  Turnover 

XIV  WIDER  SOCIAL  CONTROL 233 

Effect  of  Outside  Forces  on  Industry 

Effect  of  Environment  on  Human  Nature 

International  Relations 

Universal  Eight-Hour  Day 

The  Unemployment  Problem 

Immigration  Problem 

National  Legislation  and  Administration 

Industrial  Research 

The  Department  of  Labor 

Children's  Bureau  and  Public  Health  Service 

Government  Interest  in  Labor  Problems 

State   Industrial    Machinery 

Tendencies  of  State  Legislation 

Basis  of  Community  Control 

Personnel  and   Statistical   Departments 

XV    ORGANIZATION  OF  THE  PERSONNEL  DEPARTMENT    .    .    .  246 

Rank  of  Employment  Executive 
Importance  of  Labor  Policy 


CONTENTS 


CHAPTER 


PAGE 


Correlation  of  Labor  and  Sales  Policies 
Relation  to  Production  Department 
Finance  and  the  Personnel  Department 
Relation  to  Other  Executive  Departments 
Correlation  of  Work  Within  Department 
Plant  Education  and  Original  Research 
Equipment  for  Plant  Education 
The  House  Organ 
The  Personnel  Director's  Job 
What  the  Director  Should  Know 

XVI    DEMOCRACY  IN   INDUSTRY 260 

Growth  of  Political  Democracy 

Diversity  of  Democratic  Institutions 

Method  of  Democratic  Advance  in  Politics 

Shifting  Emphasis  to  Industrial  Democracy 

Science  and  Democratic  Industrial  Control 

Growth  of  Joint  Management 

Phases  of  Joint  Management 

Collective  Bargaining 

Joint  Control  of  Finance  and  Sales 

Steps  in  the  Change 

Principles  of  the  Works  Council 

XVII    FORMS  OF  JOINT  MANAGEMENT 273 

The  Leitch  Plan 

Application  of  Leitch  Plan 

Weaknesses  of  Plan 

Governmental  versus  Joint  Council  Method 

The  Shop  Committee 

Departmental  Representation  on  Councils 

Philadelphia  Rapid  Transit  Company  Plan 

Fundamental  Principle  of  All  Plans 

Powers  of  Works  Councils 

Effect  of  Joint  Management  on  Management  Staff 

Effect  of  Joint  Management  on  Workers 

Adjustment  of  Minor  Disagreements 

Final  Means  of  Adjustment 

Qualifications  for  Voters 

Efficiency  and  Production 


XVIII    UNION  CONTRIBUTIONS  TO  JOINT  MANAGEMENT    .    .     . 

Original  Object  of  Joint  Management 

Conditions  in  Garment  Trades 

The  Fight  for  the  Closed  Shop 

The  Garment- Workers'  Protocol 

Absence  of  Deadlock 

Influence  of  Protocol  on  Sanitation 

The  Preferential  Union  Shop 

The  Shop  Clerks 

Evolution  of  Industrial  Democracy  through  the  Protocol 


290 


CONTENTS  xi 

CHAPTER  PAGE 

Cause  of  Collapse  of  Protocol 
The  Strike  of  1915 

Fundamental  Principles  of  Joint  Management 
Educational  Value  of  Protocol 
The  Hart,  Schaffner  and  Marx  Trade  Board  Plan 
National  Extension  of  Plan 
The  Labor  Manager 
Success  of  Trade  Board  Plan 
Effect  of  Joint  Management  on  Production 
Interest  of  Union  in  Efficiency 
Joint  Management  in  Other  Trades 

XIX    BRITISH  EXPERIMENTS  IN  JOINT  MANAGEMENT    .    .    .  317 

Organization  of  British  Labor 

Effect  of  War  on  Unions 

Shop  Stewards  and  Committees 

The  Whitley  Industrial  Council  Plan 

Opposition  to  Compulsory  Arbitration 

Constructive  Task  of  Joint  Management 

Questions  for  Joint  Consideration 

Testing  the  Whitley  Plan 

The  Whitley  Plan  and  Building  Trades 

Joint  Management  of  Government  Work 

New  View  of  the  Labor  Problem 


PERSONNEL  RELATIONS 
IN  INDUSTRY 


CHAPTER  I 

THE  CHANGING  VIEWPOINT 

The  Functionalization  of  Social  Institutions 

Every  social  institution  is  specialized  to  perform  one 
function.  Interference  with  this  function  cripples  or  destroys 
the  institution.  The  fundamental  function  of  industry  is  to 
produce  the  goods  needed  by  society,  and  to  this  everything 
else  must  be  secondary.  „  Whatever  interferes  with  produc- 
tion threatens  industry  and  the  society  built  upon  it.  ^What- 
ever increases  production  strengthens,  improves,  and  develops 
industry  and  makes  possible  a  higher  social  evolution. 

The  workings  of  other  institutions  illustrate  this  speciali- 
zation. The  fundamental  function  of  the  school  is  education. 
During  the  war  the  schools  were  used  for  many  purposes. 
They  collected  money  for  the  Treasury  Department,  aided 
in  Red  Cross  activities,  and  gave  assistance  in  many  other 
fields.  The  future  promises  a  wider  extension  of  activity. 
Schools  will  be  brought  into  closer  relation  with  industry. 
They  will  be  made  an  integral  part  of  all  society.  But  if 
this  broadening  of .  scope,  methods,  and  work  causes  the 
schools  to  be  used  in  such  a  way  as  to  interfere  with  their 
work  of  education,  they  will  be  crippled  and  their  value 
reduced.1 

Production  the  Function  of  Industry 

So  whatever  changes  may  be  brought  into  the  factory  and 
hpwpver  great  the^expansjonjoj  its  activities,  production_rrro5t 
always  be_jcejgtjippermost  injnind. 

'John    Dewey,    The    Schools    of    Tomorrow,    1915,    p.    176. 

3 


4  PERSONNEL   RELATIONS   IN   INDUSTRY 

This  standard  is  not  so  simple  of  application  as  it  sounds. 
The  object  of  industry  is  production  through  a  long  period, 
and  not  in  such  sudden  spurts  as  eventually  prove  harmful  to 
the  persons  involved.  It  is  the  production  of  goods,  not  evils, 
of  wealth,  not  "illth,"  to  use  Ruskin's  well-known  term,  that 
is  sought.  Production  must  be  primarily  of  commodities  for 
use,  not  dollars  for_incQm£,  Industry  exists  to  provide_ggods 
for  the  community,  not  wages  for  labor  nor  profits  for_£m- 
rjToyersL  Not  that  industry,  as  it  exists  today,  can  run  with- 
out producing  both  wages  and  profits,  any  more  than  machines 
can  run  without  oil.  Still  machines  are  not  run  to  consume 


The  community  needs  service  first,  regardless  of  who 
gets  the  profits,  because  its  life  depends  upon  the  service 
it  gets.  The  business  man  says  profits  are  more  important 
to  him  than  the  service  he  renders;  that  the  wheels  of  busi- 
ness shall  not  turn,  whether  the  community  needs  the  service 
or  not,  unless  he  can  have  his  measure  of  profit.  He  has 
forgotten  that  his  business  system  had  its  foundation  in 
service,  and  as  far  as  the  community  is  concerned  has  no 
reason  for  existence  except  the  service  it  can  render.8 

Personnel  Relations  and  Production 

This  point  of  view  applies  to  all  phases  of  personnel  rela- 
tions. Employers  often  speak  in  an  apologetic  manner  of 
the  increased  production  due  to  welfare  work.  Such  work 
has  no  place  unless  it  does  further  production. 

The  science  of  personnel  relations  pleads  this  justification 
—  that  it  aids  production.  It  is  maintained  that  the  exten- 
sion of  scientific  principles  to  human  relations  means  an 
impetus  to  production  comparable  only  to  that  of  the  appli- 
cation of  power  to  machinery  in  the  industrial  revolution  of 


*H.  L.  Gantt,  Organizing  for  W°rk,  1910,  p.  5;  also  in  Engineering 
Magazine,  Apr.  1916,  pp.  1-5.     Italics  in  original. 


THE   CHANGING   VIEWPOINT  5 

the  eighteenth  century.  This  is  the  opinion  of  Arthur  H. 
Young,  manager  of  industrial  relations,  of  the  International 
Harvester  Company,  who  says:  3 

The  present  focussing  of  attention  on  personnel  rela- 
tions, I  think,  will  result  in  a  new  era  in  industry  —  as  much 
an  epochal  change  as  we  have  had  through  various  funda- 
mental causes  heretofore;  such  as  the  change  from  the 
original  craftsmanship  to  larger  shop  organization,  made 
possible  by  power  development,  power  transmission,  changes 
wrought  by  methods  of  communication  and  refinement  of 
the  methods  of  transportation,  the  era  of  consolidation  of 
interests,  and  so  on,  and  one  has  to  stop  and  wonder  why 
at  last  we  have  come  to  a  consideration  of  the  human 
factor. 

Such  increased  power  of  production  is  vitally  essential  in 
the  years  following  the  greatest  destruction  of  products  and 
productive  power  in  the  history  of  civilization.  When  to  this 
destruction  is  added  the  increased  volume  of  goods  necessi- 
tated by  the  risen  standards  of  life  of  the  people  and  the 
awakening  of  great  sections  of  mankind  to  the  possibilities 
of  a  higher  civilization,  the  need  of  greater  production  does 
not  require  further  proof. 

Personnel  relations  in  industry  will  be  the  determining 
factor  in  the  futurerace  for  national  economic  supremacy, 
relations  were  the  deciding  tactor  in  the 


last  century.  "Inasmuch  as  production  was  the  controlling 
factor  in  the  great  war,"  says  H.  L.  Gantt,  "it  will  hereafter 
be  the  controlling  factor  in  the  world,  and  that  nation  which 
first  recognizes  the  fundamental  fact  that  production  and  not 
money  must  be  the  aim  of  our  economic  system,  will,  other 
things  being  equal,  exert  a  predominating  influence  on  the 


'  A.  H.  Young,  Industrial  Personnel  Relations,  Mechanical  Engineering, 
July,  1919,  PP.  581-586. 


6  PERSONNEL   RELATIONS   IN   INDUSTRY 

civilization  which  is  to  be  built  up  in  the  period  of  recon- 
struction upon  which  we  are  now  entering."  4 

Scientific  Approach  to  Industry 

Notwithstanding  the  fact  that  mechanical  progress  has 
come  through  the  application  of  the  principles  of  such  estab- 
lished sciences  as  chemistry,  physics,  mathematics,  and  biol- 
ogy, the  tendency  still  exists  on  the  part  of  many  so-called 
practical  men  to  look  askance  at  the  word  "science"  and  to 
assume  that  it  deals  with  materials  and  methods  in  ways  not 
effective  in  ordinary  business.5  There  is  a  simple,  accurate 
definition  of  science  which,  if  kept  in  mind,  automatically 
shows  the  absurdity  of  this  attitude,  namely:  Science  is  tested, 
standardized,  classified  knowledge.^ 

It  is  a  simple,  but  often  overlooked,  truth  that  human 
progress  in  every  field  is  measured  by  the  degree  to  which  the 
facts  in  that  field  have  been  made  scientific  —  have  been  tested, 
standardized,  and  classified.  Progress  is  always  from  chance, 
guesswork,  chaos,  magic,  commonsense,  and  personal  expe1 
rience,  to  investigation,  standard  experiment,  order,  science, 
fired  irri  on,  and  power— 


f  Unequal  Advance 
In  social  matters,  as  Lester  F.  Ward  has  pointed  out, 
progress  moves  like  the  incoming  tide  upon  a  sloping,  irregular 


*H.  L.  Gantt,  Organizing  for  Work,  1919,  p.  56. 

8  "Many  men  of  affairs  are  much  prejudiced  against  the  invasion  of 
business  by  science  and  theory.  They  conceive  of  these  things  as  some- 
thing new  and  untried,  and  something  opposed  to  experience.  A  certain 
excuse  for  this  view  exists  in  the  fact  that  the  scientific  method  has 
thus  far  since  its  discovery,  been  applied  most  prominently  to  facts  which 
ordinary  experience  does  not  furnish,  but  which  are  attainable  only 
through  the  somewhat  rigid  and  refined  methods  of  the  laboratory.  .  .  . 
Only  in  the  delicate  scales  of  science  can  the  complicated  conditions  of 
practical  affairs  be  accurately  weighed,  and  the  various  factors  con- 
tributing to  success  or  failure  be  disentangled  and  appraised." — E.  D. 
Jones,  Business  Administration — The  Scientific  Principles  of  a  New  Pro- 
fession, 1913,  pp.  4,  6. 


THE   CHANGING   VIEWPOINT  7 

beach.  Here  an  arm  is  thrust  out  far  in  advance;  there  an 
obstacle  momentarily  stays  the  advancing  waves,  only  to  break 
and  admit  a  swift  and  sometimes  destructive  flood.  Always 
the  line  as  a  whole  moves  onward  and  upward. 

So  science  is  today  advancing  into  industry.6  It  has  pro- 
ceeded further  in  some  fields  than  in  others,  but  wherever  it 
has  gone  the  gain  has  been  great. 

The  emphasis  in  industrial  management  must  be  shifted 
from  materials  and  machines  to  men  and  methods.  Hitherto 


industrial  progress  has  largely  depended  upon  inventions  in 
the  field  of  mechanics.  Progress  in  this  direction  has  out- 
run  the  application  of  scientific  methods  to  human  relat 

*         ""  ""'  w 

Availability  of  Scientific  Knowledge 

One  of  the  greatest  advantages  of  scientific  knowledge 
is  that  after  it  has  been  tested,  classified,  and  standard- 
ized,  it  can  be  passed  on  in  time  and  space.  Knowledge 
based  upon  the  experience  of  a  single  individual  has  not 
been  tested  under  exact  specifications,  nor  clearly  defined 
and  standardized,  nor  classified  in  its  relation  to  the  great 
body  of  related  facts,  nor  can  it  be  handed  on  to 
others.  It  is  of  little  value  to  anyone  except  the  person 
who  originally  experienced  it,  and  of  very  uneven  and  gen- 
erally much  exaggerated  value  to  him.  But  a  new  fact,  when 

*  "As  is  commonly  the  case  with  a  body  of  data  undergoing  process  of 
transformation  into  that  condition  of  definiteness  deserving  the  name  of 
science,  the  advance  does  not  take  place  with  equal  rapidity  at  all  points 
but  is  like  a  skirmish  line  moving  forward  over  irregular  terrain.  For 
practical  purposes  solely,  both  because  it  expedites  the  systematization  of 
business  knowledge  in  general  and  particularly  because  it  corresponds  to 
more  or  less  well-defined  phases  of  the  organization  itself,  the  data  per- 
taining to  management  are  to  be  classified  under  four  heads :  Production, 
sales,  finance  and  accounts.  So  far  as  these  are  concerned  from  the 
standpoint  of  scientific  procedure,  it  is  probably  not  far  from  correct  to 
say  that  up  to  the  present  accounting  has  attained  the  most  definiteness 
in  its  principles,  following  which  comes  production,  finance  and  sales  in 
the  order  named." — E.  B.  Gowin,  The  Selection  and  Training  of  the 
Business  Executive,  1918,  p.  123. 


PERSONNEL  RELATIONS   IN  INDUSTRY 

tested,  standardized,  and  classified  by  scientific  methods  and 
expressed  in  the  standardized  languages  of  the  world,  though 
it  may  have  originated  in  a  South  African  diamond  mine,  can 
be  used  the  same  day  in  China,  Japan,  Europe,  or  America, 
if  of  sufficient  value  to  justify  communication. 

Such  knowledge  can  be  stored  away  in  files,  books,  or 
otherwise,  and  can  be  taken  out  at  any  time  and  used  by 
anyone  familiar  with  scientific  methods.  When  so  used  the 
results  will  always  be  the  same,  because  all  the  conditions 
surrounding  its  use  will  have  been  known  and  stated. 

Limitations  of  Individual  Experience 

Individual  experiences  of  practical  men  are  of  value_only 
when  many  such  expjgrienrps  are  rnlWtpH  qnH  rompqrpH  _Per- 
sonal  experience  is  always  from  a  single  viewpoint,  limited 
to  the  capacity  of  the  one  person  and  subject  to  all  the  errors 
and  manifold  prejudices  found  in_every  individual  mind.  Such 
information  is  seldom  specific,  definite,  or  accurate.  It  deals 
in  generalities  and  ready-made  judgments  and  conclusions 
rather  than  facts.  In  the  field  of  personnel  relations  we  find 
those  who  depend  upon  their  own  narrow  experience  talking 
much  of  honesty,  justice,  the  square  deal,  and  similar  phrases 
of  little  definite  meaning.  Such  phrases  can  never  be  stand- 
ardized because  they  vary  with  every  individual.  They  are 
like  a  tape  measure  made  of  elastic ;  they  give  whatever  result 
the  user  wishes.  One  of  the  oldest  and  commonest  of  these 
standards  is  justice.  An  often  quoted  definition  of  "justice" 
is  found  in  the  Roman  law  and  reads  as  follows:  "Justice 
consists  in  giving  to  each  person  what  he  deserves."  The 
difficulty  is  that  the  dispute  is  always  about  what  is  deserved, 
and  not  about  the  abstract  idea  of  justice. 

Accurate  observation  and  valuable  conclusions  in  industrial 
relations,  as  elsewhere,  are  possiblejDnly  when  the  scientific 
methods  of  exactness  and  impartiality  are  used.  These  have 


THE  CHANGING  VIEWPOINT  9 

been  the  foundation  of  progress  in  other  departments  of 
human  knowledge,  and  the  rule  holds  true  in  industry.7 

Scientific  Methods  in  Industry 

Science  is  the  greatest  labor-saver.  It_adds  power  to  all 
it  touches.  It  builds  up  an  inexhaustible  store  of  tested, 
classified  knowledge,  the  property  of  all  society,  available  to 
anyone  on  an  instant's  notice  and  growing  larger  the  more 
it  is  used.  This  great  store  of  knowledge  is  the  foundation 
of  civilization!  Even  in  industry,  despite  its  present  rough  ^ 
andimperf  ect  form,  it  is  the  accumulated  surplus  ojjjg: 

'principles  gatb*™^  by  all  rfip  rnftcmpn  nf  rhpLpast  that  forms 

itsmost  valuable  asset,8  If  this  industrial  knowledge  were 
tested,  standardized,  and  classified,  as  is  the  similar  fund  of 
knowledge  in  the  scientific  storehouses  of  geology,  chemistry, 
and  other  sciences,  industry  would  move  forward  by  great 
leaps  as  compared  with  its  present  progress. 

Such  a  fund  of  knowledge  finally  climaxes  in  rules,  prin- 
ciples, standards — so-called  scientific  laws — summarizing  the 
results  of  repeated  and  accurate  observations.  Through  the 
use  of  these  laws  future  events  can  be  predicted  and  chance 
eliminated.  The  physicist  knows  what  will  happen  when  two 
known  forces  are  united  upon  a  certain  resistance.  The 


T  E.  D.  Jones,  Business  Administration — The  Scientific  Principles  of  a 
New  Profession,  1913,  p.  6;  H.  C.  Link,  Employment  Psychology,  1919, 
pp.  100-101. 

1  "Technological  knowledge  is  of  the  nature  of  a  common  stock,  held 
and  carried  forward  collectively  by  the  community,  which  is  in  this  relation 
to  be  conceived  of  as  a  going  concern.  The  state  of  the  industrial  arts 
is  a  fact  of  group  life,  not  of  individual  or  private  initiative  or  innovation. 
In  the  main  the  state  of  the  industrial  arts  is  always  a  heritage  out  of  the 
past;  it  is  always  in  process  of  change,  perhaps,  but  the  substantial  body 
of  it  is  the  knowledge  that  has  come  down  from  earlier  generations. 
New  elements  of  insight  and  proficiency  are  continually  being  added  and 
worked  into  this  common  stock  by  the  experience  and  initiative  of  the 
current  generation,  but  such  novel  elements  are  always  and  everywhere 
slight  and  inconsequential  in  comparison  with  the  body  of  technology  that 
has  been  carried  over  from  the  past." — Thorstein  Veblen,  The  Instinct  of 
Workmanship,  1914,  p.  103. 


10  PERSONNEL   RELATIONS   IN   INDUSTRY 

chemist  can  foretell  the  result  of  combining  two  elements. 
But  the  business  man  still  guesses  at  the  results  of  the  invest- 
ment of  capital,  the  hiring  of  men,  and  the  buying  and  opera- 
tion of  machines.  Moreover,  the  history  of  business  failures 
shows  that  he  generally  guesses  wrong. 

The  Superman  Rarely  Available 

Lacking  knowledge  and  accurate  methods,  successful  in- 
dustrial management  depends  upon  the  possibility  of  discover- 
ing "supermen"  who  can  accumulate  and  assimilate  a  vast 
amount  of  untested,  chaotic  knowledge  and  draw  approxi- 
mately accurate  conclusions.  When  once  any  field  of  knowl- 
edge has  been  reduced  to  science,  the  ordinary  man  can  apply 
tested  standards  with  much  greater  certainty  of  the  results 
than  the  exceptional  man  can  apply  unscientific  knpwledge. 
This  leaves  the  exceptional  man  free  to  undertake  new  prob- 
lems and  to  do  really  great  work.  Science  saves  such  excep- 
tional persons  from  the  tedious  and  wasteful  work  of  repeat- 
ing the  experiences  of  the  race.  It  lifts  the  average  person 
of  each  generation  to  the  shoulders  of  geniuses  that  have 
preceded  him.9 

Edwin  G.  Rust,  industrial  engineer,  states  this  truth  as 
follows:10 


9  "In  the  past  the  prevailing  idea  has  been  well  expressed  in  the  saying 
that  'Captains  of  industry  are  born,  not  made' ;  and  the  theory  has  been 
that  if  one  could  get  the  right  man,  methods  could  be  safely  left  to  him. 
In  the   future  it  will  be  appreciated  that  our  leaders  must  be  trained 
right  as  well  as  born  right,  and  that  no  great  man  can    (with  the  old 
system   of   personal  management)    hope   to  compete  with   a  number   of 
ordinary  men  who  have  been  properly  organized  so  as  efficiently  to  co- 
operate.   In  the  past  the  man  has  been  first ;  in  the  future  the  system  must 
be  first.     This  in    no  sense,   however,   implies  that  great  men  are  not 
needed.    On  the  contrary  the  first  object  ot  any  good  system  must  be  that 
of  developing  first-class  men;  and  under  systematic  management  the  best 
man  rises  to  the  top  more  certainly  and  more  rapidly  than  ever  before." — 
F.  W.  Taylor,  Principles  of  Scientific  Management,  1911,  p.  6. 

10  E.  G.  Rust,  Centralization  vs.  Decentralization  in  Industrial  Manage- 
ment, Annals  of  the  American  Academy,  Sept.  1919,  pp.  100-109.  / 


THE   CHANGING   VIEWPOINT  II 

It  must  be  remembered  that  the  development  of  all  demo- 

is   fl\vay    frnrn    th*>   Hnminatinn    nf   and    jg- 


pendencf'  uprm  th^  pvrpptinnal  man,  In  fact  this  has  been 
the  history  of  the  development  of  all  science.  The  real 
purpose  and  object  of  science  is  so  to  develop  and  epitomize 
facts,  invention,  experience  and  knowledge  as  to  make  them 
available  to  the  average  man.  Watt  invented  the  steam  en- 
gine, but  the  science  of  thermodynamics  and  the  steam 
engine  has  so  developed  this  art  that  we  are  no  longer  de- 
pendent upon  exceptional  men  of  the  genius  of  Watt  to  de- 
sign and  construct  the  steam  engine  in  the  best  forms  of  its 
development. 

I  do  not  mean  to  state  that  the  science  of  industrial 
organization  has  reached  that  state  where  we  are  inde- 
pendent of  the  exceptional  man.  But  the  tendency  will  con- 
tinue in  that  direction  and  will  more  and  more  approximate 
to  that  condition,  leaving  it  to  the  efforts  of  men  of  genius 
eventually  to  carry  it  forward  to  the  forms  of  its  still 
higher  development.  Exceptional  men  are  rare  and  it  is 
folly  so  to  organize  a  comparatively  simple  industrial  propo- 
sition on  lines  which  overtax  the  capacity  of  the  average 
man  when  such  procedure  is  unnecessary  in  the  light  of 
the  present  advancement  in  the  field  of  industrial  organi- 
zation. 

Science  and  Financial  Control 

Science  moves  into  the  industrial  field  by  the  already  men- 
tioned law  of  unequal  advance.  Financial_£Qntrol  made 
science  necessary  first  in  the  field  of  accounting,  but  even  here 
the  entry  was  comparatively  recent.  Accurate  cost  systems 
have  been  in  existence  but  a  few  years.  Price  estimates  are 
still  largely  guesses.  Estimators  guess  at  the  guess  of  their 
competitor  and  then  place  their  guess  a  few  cents  lower,  hop- 
ing that  both  have  guessed  within  the  profit  limit.  Yet  cost 
systems  of  great  accuracy  are  ignored  at  the  risk  of  bank- 
ruptcy, and  with  what  result  is  shown  from  a  quotation  from 
a  recent  report  of  the  Federal  Trade  Commission: 


12  PERSONNEL  RELATIONS   IN  INDUSTRY 

Only  ten  per  cent  of  our  manufacturers  know  the  actual 
cost  of  manufacture  and  sale  of  their  products;  fifty  per 
cent  have  no  method,  but  price  their  goods  arbitrarily.  There 
were  22,000  business  failures  in  the  United  States  last  year. 
The  first  and  greatest  need  of  American  manufacturers  is 
for  better  methods  of  cost  accounting. 

Science  as  an  Aid  to  Purchasing 

Science  was  next  11<^  i"  thp  jiiHjrmonf  of-marpriajs     In 

Some   departments   of   this   field   sn'fntifir    standards  ha(^    Innp 

been  familiar.  The  bushel,  foot,  pound,  and  yard  are  among 
the  oldest  of  standardized  units.  -The  organised  sn'enre^of 
the  laboratories  was  slower  in  invading  industry.  When,  some 
thirty  years  ago,  a  great  American  firm  began  to  buy  its  coal 
by  British  thermal  units  instead  of  by  the  ton,  this  applica- 
tion of  the  scientific  method  was  so  novel  as  to  attract  wide 
attention  through  the  press. 

Until  within  the  present  generation  steel  was  generally 
bought  by  its  appearance  or  trade-name.  Today  the  amount 
of  carbon,  vanadium,  molybdenum,  or  other  alloy  or  essential 
element  desired,  is  determined  in  advance  by  the  metallurgist 
and  set  forth  in  the  specifications.  There  is  little  need  of 
expert  knowledge  in  the  ordering  of  such  standardized  ma- 
terials. Once  the  standard  has  been  established,  the  specifi- 
cations can  be  duplicated  any  number  of  times,  in  this  way 
insuring  uniformity,  economy,  and  accuracy  throughout  the 
whole  process  of  manufacture.  Xhe  use  of  scientific  methods 
in  handling  materials  led  to  the  establishment  of 
departments_jyith  a,  standard  tprhniqn^  just  3,5  fre 
of  accounting  developed  the  accounting  department  and  ex- 
pert accountants. 

Application  of  Science  to   Management 

The  step  from  materials  to  process  was  a  short  but  ex- 
tremely "Important,  one.     When  Frederick  W.  Taylor  intro- 


THE  CHANGING  VIEWPOINT  13 

duced  so-called  "scientific  management"  with  accurate  time, 
motion,  and  fatigue  studies,  routing  of  work,  functional  fore- 
men, planning  departments,  and  standard  practice  instruc- 
tions, he  set  in  motion  a  revolution  in  industrial  management 
whose  results  are  just  beginning  to  appear.  Similar  methods 
were  adapted  to  office  work,  and  desks  as  well  as  machines 
were  arranged  for  routing  work.  Typewriting,  filing,  index- 
ing, and  bookkeeping,  when  subjected  to  the  same  careful 
study,  revealed  the  same  wastes  and  the  same  possibilities 
of  increased  efficiency.11 

Because  scientific  management  came  into  industry  through 
the  engineering  department,  it  inevitably  suffered  in  the  be- 
ginning from  neglect  and  misunderstanding  of  the  human" 
elemenj.12  Much  greater  difficulties  arose  because  the  prin- 
ciples set  forth  by  Taylor  were  not  carried  out  by  many  of 
his  ostensible  followers.  They  lacked  his  techniqueThTs  broa<4, 
scientific"visT6n>^ind  were  too  anxious  to  produce  immediately 
profitableresults_for  themselves  and  their  clients. 

Application  of  Science  to  Personnel  Relations 

Before  science  could  be  effectively  applied  to  such  a  stu- 
pendous^iew  fiHH  as  that  nf  industrial  management,  much 
was  needed_in  addition  to  the  knowledge  of  the  important 
fundamental  principles  set  forth  by  Taylor^  To  apply  those 
principles  properly,  a  highly  developed  technique  had  first  to 


MW.  H.  Leffingwell,  Scientific  Office  Management,  1917,  pp.  13-72, 
203-210  et  passim. 

""It  is  no  secret  that  Dr.  Taylor  was  not  himself  very  much  of  a 
manager.  Persistence  and  genius  he  had  without  end.  But  he  was  not 
an  adept  at  judging  men,  nor  tactful  or  conciliatory  in  his  method  of 
approach.  Even  for  his  friends  he  was  a  hard  taskmaster,  and  his 
entrance  into  a  new  plant  would  stir  things  up  from  the  bottom.  He 
insisted,  too,  that  reorganization  be  thoroughgoing  and  complete,  according 
to  what  often  seemed  preconceived  notions." — H.  B.  Drury,  Scientific 
Management  and  Progress,  Bulletin  of  Taylor  Society,  Nov.  1916,  p.  4. 
See  also  R.  F.  Hoxie,  Scientific  Management  and  Labor,  1915,  p.  120 
e t  seq. 


14  PERSONNEL   RELATIONS   IN   INDUSTRY 

be  acquired  and  a  large  body  of  scientists  trained.13  These 
requisites  are  now  being  gradually  supplied.  Unfortunately, 
before  they  were  ready  the  hostility  of  the  employees  was 
aroused  and  for  a  time  threatened  to  block  further  progress. 
This  hostility,  given  greater  power  by  the  scarcity  of  workers 
during  the  war,  forced  the  application  of  scientific  methods 
to  personnel  relations. 

The  Field  of  Personnel  Relations 

Here  the  field  was  practically  untouched.     Nowhere  in 


modern  life  was  less  use  made  ot  scienceTit  is  necessary  to 
build  almost  from  the  bottom,  but  fortunately  much  material 
lies  ready  to  hand.  The  steps  along  which  the  advance  will 
be  made  are  set  forth  in  the  following  paragraphs  which,  in 
so  doing,  outline  the  subject  matter  of  the  succeeding 
chapters. 

Staj^ar^^miisJLjje-esta^ished^-fef-evcry  clement.  A  job 
survey  of  plant  and  neighborhood,  followed  by  a  more  minute 
job  analysis,  is  the  basis  of  the  standardization  of  jobs,  the 
first  element  in  personnel  relations. 

The  Human  Element.  This  is  standardized  partly  through 
a.  study  of  the  laws  governingliuman  instincts  as  the  motives 
of  much  of  human  behavior.  Abilities  and  trade~habits"are 
measured  by  standardized  tests  which  give  accurate  knowl- 
edge of  the  possibilities  of  personnel.  With  jobs  and  capaci- 
ties known,  the  ground  is  laid  for  the  erection  of  a  scientific 
personnel  system.  The  general  outline  of  such  a  system  and 


11  "A  scientist  is  one  who  can  formulate  and  apply  standardised  knowl- 
edge in  a  given  field.  And  the  scientific  method  is  a  method  by  which 
knowledge  is  standardized  and  refined  far  beyond  the  ordinary  powers 
of  the  human  mind.  In  every  case  science  consists  of  the  application  of 
an  exact  and  refined  method  to  the  study  of  facts,  with  the  result  that 
we  have  knowledge  which  has  two  chief  characteristics :  first,  it  is 
relatively  free  from  the  inaccuracies  of  unaided  human  faculties ;  second, 
it  is  standard  knowledge,  that  is,  knowledge  which  can  be  transmitted  in 
unambiguous  and  indisputable  form  from  one  person  to  another,  or  from 
one  time  to  another." — H.  C.  Link,  Employment  Psychology,  1919,  p.  n. 


THE   CHANGING  VIEWPOINT  15 

its  method  of  growth  may  be  suggested  by  contrasting  the 
treatment  of  the  different  elements,  problems,  and  relations 
by  the  old  and  the  new  systems  of  personnel  relations. 

The  Labor  Supply.  Under  the  old,  unsystematic,  guess- 
ing,  planless  system,  the  labor  supply  was  the  crowd  of  Un- 
employed that  gathered  at  the  gate  or  responded  to  miscella- 
neous  advertising.  Scientific  management  organizes  the  sup- 
ply far  in  advance,  seeks  iFout  by  ssyste'malii  methods,  classi' 
figs  it.  and  retains  the  list  as  a  reserve.  It  considers  sucH  a 
classified  source  of  supply  fully  as  necessary  to  effective  func- 
tioning of  industry  as  a  corresponding  financial  reserve  of 
securities  or  credit. 

Selection  of  Employees.  Selection,  instead  of  beingbased 
upon  a  glance  of  the  foreman's  eye,  jt  few  hasty  unstandard- 
ized  questions,  and  a  superficial  method  of  judging  human 
nature,  has  developed  into  a  scientific  system  of  adjusting  the 
available  workers  to  the  most  suitable  positions  through  the 
use  of  standardized  application  blanks,  references,  records, 
and  interviews,  all  used  to  fill  standard  job  specifications.  The 
worker's  competent  tr>  gati'gfy  cnrh  srnrificatjonjjsn^t  deter- 
mined by  guessing,  but  by  physical,  m^nta.],  and  trade~tesj 
ar?  ff^nFtantly  growing  in  valnf*  and 


Introducing  Employees.  The  common  method  of  assign- 
ment and  introduction  under  the  old  system  was  to  say:  "Go 
down  to  shop  10  and  tell  Bill  Jones,  the  foreman,  to  put  you 
to  work."  A  standajxLjmd  tested  plan  nf  introducing  and 
adjusting  the  new  worker  removes  the  feeling  of  hostility  anct 
strangeness,  shortens  the  time  of  learning;  and  reduces  waste- 
ful labor^turnoyer. 

Training.  The  pjanless_system  that  -succeeded  apprenr 
ticeship  expected  the  new  employee  to  pick  up,  or  steal,  his 
tra3e^  Scientific  investigation  proved  this  to  be  the  most  ex- 
pensive method  yet  discovered  to  educate  workers,  and  estab- 
lished instead  carefully  planned  training  systems. 


16  PERSONNEL   RELATIONS   IN   INDUSTRY 

Promotion.  Prnrnotinn  formerly  rpstfH  on  rhnnnyffnvjm'- 
itism,  and  nepotism.  The  vacant  jobs  were  given  to  those 
Belonging  to  the~same  race,  lodge,  church,  or  clique  as  the 
foreman  Standard  ratingjscales.  measurement  of  work,  and 
planned  promotion  systems  give  increased  incentive,  greater 
production,  and  more  harmonious  organization. 

Personnel  Records.  These  records  were  once  r.onfjjied 
ajmost  entirely  to  the^paYrroll.  Other  facts,  if  noted  at  all, 
were  kept  in  the  memory  of  the  employer.  Modern  industry 
notes  every  fact  worth  preserving  in 


fied  records^,  To  this  infallible  mechanical  memory  reference 
is  made  for  data  upon  which  to  base  changes  in  personnel 
relations.  These  records  include  production  possibilities  and 
promotion  desires,  turnover  rate,  and  all  other  facts  that  con- 
tribute to  better  human,  association  and  increased  production1. 

Discipline.  E)isciplme  was  enforced,  f  ormerly,  by  ahusky 
foreman  with  an  extensive  and  vigorous  vocabulary  acquired 
from  experience  under  a  similar  foreman  in  his  journeyman 
djijrs.  Proper  discipline  now  rests  upon  well-established  shop 
standa/ds.  pedagogical  principles.  and  accurate  records/^get 
up  with  the  co-operation  of  the  entire  force  and  impartially 
administered  -by  bodies  jointly  chosen  for  that  purpose. 

Production  Standards.  The  production  standard  of  the 
guessing  system^  ofjndustry  was~wKaT  could  be  gotten  out  of 
the  workert  Employee  and  Inanagerrient  played  a  game,  the 
former  to  do  as  little,  the  latter  to  compel  as  much  work  as 
possible.  In  many  instances  more  energy  was  consumed  in 
conflict  than  upon  production.  In  a  scientifically  managed 
factory,,  production  standards  rest  upon"  time,  m6tion4_^fld> 
fatigue  studies  conducted  under  joint  management. 

Wages  and  Hours.  Wagesand  hours  may  be  determined 
hj^jTghijng^  gtrpngfh  A  better  way  is  to  use  scientific  stand- 
ards  of  living  to  determine  the  minimum,  and  joint  manage- 
ment of  production  and  organization  to  fix  the  maximum  con- 


THE  CHANGING  VIEWPOINT  I? 

sistent  with  industrial  growth  and  prosperity.  The  latter 
method  involves  local  and  national  studies  of  prices  and  bud- 
gets and  the  application  of  efficiency  methods  to  production. 

Economy  of  Time  and  Effort 

j>cience  sgfks  ftyprywhpre  to_siibgtjtiitfi  intelligent  artificial 
selection  for  compulsory  natural  selection!  Mature,  in  the"1 
words  of  the  geologist  and  biologist,  who  Have  so  long  studied 
her,  "has  all  the  time  and  all  the  material  there  are."  Nature 
can  afford  to  use  a  million  years  and  countless  billions  of 
organisms  to  produce  one  minute  gain.  The  unscientific  man- 
ager acts  as  if  he  were  as  prodigally  endowed  with  resources 
as  Nature.  He  tries  all  methods,  trusting  to  his  own  expe- 
rience to  know  when  he  finds  the  right  one  concealed  in  an 
infinity  of  wrong  ways. 

The  stored-up  facts  and  proved  principles  of  science  make 
it  possible  to  predict  right  ways  without  experiment.  That 
is  the  task  the  establishment  of  scientific  personnel  relations 
in  industry  is  getting  ready  to  do.  Although  still  in  process 
of  formation,  with  much  yet  to  be  learned,  there  is  much 
scientific  material  ready  for  use.  Additions  to  this  store  of 
knowledge  are  being  steadily  made  by  establishing  standards, 
developing  technique,  classifying  and  testing  facts,  and  prov- 
ing principles. 

Contributions  of  the  Older  Sciences 

The  birth  of  every  new  science  is  attended  by  a  scene 
much  like  that  described  in  a  familiar  fairy  tale.  The  good 
fairies  each  brought  a  gift  to  the  christening  of  the  princess. 
Around  the  cradle  of  this  new  science  stand  the  older  sciences 
with  their  splendid  gifts. 

political  Economy  brings  her  knowledge  of  the  laws  of 
wages,  prices,  and  values,  of  statistical  methods  and' the 
growth  and  development  of  industry,  of  the  Iaw¥lhaTlindeT- 


18  PERSONNEL   RELATIONS   IN   INDUSTRY 

lie__exchange,  trade,  and  the  organization  of  the_f orces  of 
industry.  Psychology  brings  her  store  of  knowledge  of, the 
workings  of  the  human  mind,  her  most  recent  and^JiQudest 
achievement— the  methods  of  testing  abilities  and  habits,  and 
new  discoveries  concerning  the  laws  that  govern_human  be^" 
hayjpr.  Sociology  contributes  her  priceless  store  of  facts 
concerning  the  growth  of  institutions  and  the  forces  that^ 
govern  their  movements.^  Large  contributions  are  donated  by 
the  near  relatives  of  the  newly  born  science — accounting,  and 
scientific  factory  and  office  management.  _  All  this  rich  store 
of  raw  material  must  be  worked  over,  tested  by  new  norms, 
standardized  to  meet  new  tasks,  and  assimilated  with  much 
new  material  before  there  will  be  a  really  worth-while  science 
of  personnel  relations. 


CHAPTER  II 

STANDARDIZATION  OF  EMPLOYMENT  ELE- 
MENTS—THE JOB 

Standards  and  Civilization 

In  a^jvery  great  degree  civilization  reflects  a  process  of 
standardization.  Each  achievement  must  be  standardized 
before  it  can  be  effectively  utilized  in  the  life  and  institutions 
<>FjJocie|y]  Indeed,  institutions  are  but  standardized  ways  of 
doing  things.  Intelligent  communication  became  possible  only 
after  speech  had  become  standardized.  This  established  a 
common  agreement  as  to  the  words  to  be  used  in  naming 
things,  describing  actions,  grading  qualities,  and  expressing 
ideas.  A  standard  alphabet  gave  birth  to  the  art  of  writing. 
Centuries  later  printing  standardized  methods  of  recording 
and  transmitting  thought.1 

Definition  of  "Standards" 

Frank  B.  Gilbreth  considers  that  for  industrial  purposes 
Morris  L.  Cooke,  director  of  the  Philadelphia  Department  of 


"The  forward  march  of  civilization  has  only  been  rendered  possible 
by  the  adoption  of  standards.  Standards  passed  on  from  father  to  son 
and  from  generation  to  generation  represent  ratchets  on  the  wheels  of 
progress,  and  have  enabled  each  forward  step  painfully  and  slowly  made, 
to  be  maintained.  Without  the  privilege  of  drawing  on  the  accumulated 
experience  of  the  race  as  represented  by  its  standards,  each  individual 
would  be  compelled  to  start  in  right  at  the  beginning  and  progress  would 
have  been  impossible. 

"Whereas  the  savage  had  very  few  and  simple  standards,  as  civilization 
developed  standards  increased  in  tremendous  degree  both  as  regards 
number  and  complexity,  and  in  modern  life  the  standards  covering  the 
multitudinous  activities  of  human  kind  are  of  incalculable  number." — 
G.  C.  Harrison,  Cost  Accounting  to  Aid  Production,  Industrial  Manage- 
ment, Nov.  1918. 

19 


20  PERSONNEL   RELATIONS   IN   INDUSTRY 

Public  Works,  has  standardized  the  word  "standard"  in  the 
following  definition  and  explanation  :2 

A  standard  under  modern  scientific  managements  simply 
a  carefully  thought-out  Inethod  of  performing  a  function, 
or  carefully  drawn  specifications  covering  an  implementator 
some  article  of  stores  or  product.  The  ideaT  of  perfec- 
tion is  not  involved  in  standardization.  The  standard  method 
of  doing  anything  is  simply  the  best  method  that  can  be  de- 
vised at  the  time  the  standard  is  drawn.  Standard  specifi- 
cations for  materials  simply  cover  all  the  points  of  possible 
variation  which  it  is  possible  to  cover  at  the  time  the  speci- 
fications are  drawn.  Improvements  in  standards  are  wanted 
and  adopted  whenever  and  wherever  they  are  found.  There 
is  absolutely  nothing  in  standardization  to  preclude  innova- 
tion. But  to  protect  standards  from  changes  which  are  not 
in  the  direction  of  improvement,  certain  safeguards  are 
erected.  These  safeguards  protect  standards  from  change 
for  the  sake  of  change.  All  that  is  demanded  under  mod- 
ern scientific  management  is  that  a  proposed  change  in  a 
standard  must  be  scrutinized  as  carefully  as  the  standard 
was  scrutinized  prior  to  its  adoption,  and  further  that  this 
work  be  done  by  experts  as  competent  to  do  it  as  were 
those  who  originally  framed  the  standard.  Standards 
adopted  and  protected  in  this  way  produce  the  best  that 
is  known  at  any  one  time.  Standardization  practiced  in 
this  way  is  a  constant  invitation  to  experimentation  and  im- 
provement. 

Standards  are  the  greatest  labor-savers.  They  crystallize 
the  work  of  the  great  minds  of  all  ages.  They  enable  the 
user,  by  speaking  a  name  or  following  a  set  of  instructions, 
to  utilize  all  the  brains  involved  in  the  original  creation  of  the 
standards.  They  make  the  transcendent  accomplishments  of 
great  geniuses  the  common  tools  of  the  ordinary  persons  who 
follow  them. 


3  Bulletin  No.  5,  Carnegie  Foundation  for  the  Advancement  of  Teach- 
ing. 


STANDARDIZING   THE   JOB  21 

Applying  Standards  in  Manufacture 

A  classic  illustration  of  these  truths  is  found  in  the  estab- 
lishment of  standard  methods  of  cutting  steel  by  Frederick 
W.  Taylor,  Carl  G.  Barth,  and  their  associates.  These  were 
exceptional  men,  pioneers  in  the  field  of  industry.  They 
worked  upon  their  experiments  for  twenty-six  years.  "In 
studying  these  laws,"  writes  Taylor,  "we  have  cut  up  into 
chips  with  our  experimental  tools  more  than  800,000  pounds 
of  steel  and  iron.  More  than  16,000  experiments  were  re- 
corded in  the  Bethlehem  Steel  Co." 3 

Until  these  experiments  began  there  was  almost  no  exact 
knowledge  of  the  best  methods  of  cutting  metals,  and  yet 
this  process  is  fundamental  to  much  of  modern  industry. 
Analysis  of  the  problem  showed  at  least  twelve  variables. 
These  included  the  quality  of  the  metal,  the  diameter  of  the 
work,  the  depth  of  the  cut,  and  the  thickness  of  the  shaving. 
Such  a  problem  had  been  deemed  insoluble.  Says  Taylor: 

Several  times  during  the  progress  of  this  mathematical 
work,  the  writer,  feeling  himself  completely  baffled,  has 
asked  the  expert  assistance  of  some  of  the  best  mathema- 
ticians in  the  country.  They  all  smiled  when  told  that  we 
expected  to  solve  mathematically  a  problem  containing 
twelve  variables,  and  in  each  case,  after  keeping  the  for- 
mulae before  them  for  a  longer  or  shorter  time,  returned  the 
problem  to  the  writer  with  a  statement  that  it  belonged 
distinctly  in  the  realm  of  "rule  of  thumb"  or  empiricism, 
and  could  be  solved  only  by  the  slow  method  of  trial  and 
error. 

Twg_jmportant  requisites  for  the  development  of  stand-, 
ards  are  here  illustrated:  First,  that  mathematical  formulas 

^' '        "~  „ 

must  be  devised  for  special  tasks^    In  the  case  under  consid- 

*F.  W.  Taylor,  on  the  Art  of  Cutting  Metals,  Address  before  the 
American  Society  of  Mechanical  Engineers,  Dec.  1906.  See  also,  F.  W. 
Taylor,  Principles  of  Scientific  Management,  Bulletin  of  Taylor  Society, 
Dec.  1916. 


22  PERSONNEL   RELATIONS   IN   INDUSTRY 

eration,  one  field  of  science  was  held  back  momentarily  by 
the  backwardness  of  an  older  and,  in  most  ways,  much  more 
•highly  standardized  science.  Second,  that  standardization 
constantly  moves  into  more  and  more  complex  fieldSj_always 
crowding  back  the  unstandardized  and  waste ful_methpd  of 
trial  and  erroj. 

It  is  commonly  reported  that  Barth  invented  and  standard- 
ized new  mathematical  formulas  in  order  to  solve  the  equa- 
tions resulting  from  these  complex  experiments.  When  this 
colossal  work  was  done,  its  elements  and  processes  were 
standardized.  The  staggering  mathematical  calculations  were 
embodied  in  standard  formulas  by  means  of  which  any 
ordinary  mathematician  can,  with  a  slide-rule,  solve  over 
again  in  a  few  seconds  the  same  problems  whose  investiga- 
tion and  solution  required  the  labor  of  these  two  geniuses 
for  a  generation. 

The  Elements  of  Personnel  Relations 

The  science  of  personnel  relations  is  entering  a  field 
hitherto  ruled  almost  exclusively  by  the  method  of  "trial  and 
error."  It  will  justify  its  right  to  the  name  of  science  by  its 
ability  to  standardize  the  elements  it  meets. 

The  fundamental  elements  in  personnel  relations  are  two: 
the  job,  and  the  jvEorkar'  While  these  remain  unstandardized 
there  can  be  no  certain  knowledge  or  action  concerning  their 
relations.  Immediate  progress  in  personnel  relations  _will__be 
largely  measured  by  success  in  standardizing  these  two  funda- 
mental elements. 

Analysis  of  the  job  and  of  human  nature  is  the  first  step : 
analysis  must  precede  standardization.  A  committee  of  the 
National  Association  of  Corporation  Schools  gives  this  defi- 
nition of  job  analysis:  * 


*  Report    7th   Annual   Conference,    National   Association   Corporation 
Schools,  p.  369. 


STANDARDIZING   THE   JOB  23 

Job  analysis  ...  is  the  analysis  of  the  component  parts 
of  each  particular  kind  of  work,  in  relation  to  the  worker 
responsible  for  its  performance.  A-±Man- Job-Specification'.!^ 

Ts  thT  result  of  job  analysis.  It  is  made_up  of  two  parts, 
one~describing~fhe  qualifications  of  the  individual  who  nitty 
beexpected  to  do  the  work,  the  other  the  essential  features^* 

j>f_the_j£b. 

The  first  scientific  examination  of  a  new  field  generally 
reveals  chaos.  Names,  duties,  responsibilities,  and  all  quali- 
fications for  jobs  varied  in  different  states,  cities,  and  even  as 
between  department  and  department  within  the  same  organi- 
zation. Until  there  were  standards  that  told  exactly  what 
was  to  be  done  in  each  job,  there  could  be  no  intelligent  selec- 
tion of  employees. 

The  strain  of  war  revealed  the  alarming  nature  of  this 
industrial  weakness.  When  accurate  classification  of  men  for 
work  became  a  matter  of  national  life  and  death,  there  was  a 
hasty  scrambling  together  of  classification  standards.  No  one 
knew  what  even  a  carpenter  is  expected  to  do.  In  some  places 
he  was  still  a  man  who  could  make  and  fit  window  sashes 
and  even  "rive  out  shakes"  for  roofs  that  knew  not  shingles, 
to  say  nothing  of  more  modern  roofings.  In  others  these  were 
lost  arts,  speaking  an  unknown  tongue,  and  a  carpenter  needed 
to  know  only  how  to  fit  mill-work.  Confusion  in  trades  of 
less  ancient  lineage  was  even  greater. 

The  United  States  Employment  Service  prepared  and  pub- 
lished lists  of  standard  names  and  short  descriptions  of  many 
trades.  These  will  doubtless  form  the  nucleus  of  a  more 
accurate  standardization.  The  army,  by  methods  to  be  de- 
scribed later,  established  some  standards  of  trade  ability. 

Job  Survey 

This  process  of  analysis  and  standardization  must  go  on  in 
each  plant.  The  foundation  of  any  sort  of  employment  work 


24  PERSONNEL   RELATIONS   IN   INDUSTRY 

jhould  be  a  job  survey.  Such  a  survey  is  not  necessarily  some- 
thing to  be  done  all  at  once  by  a  group  of  experts  walking 
through  the  factory  and  quizzing  each  worker.  The  services  of 
experts  may  well  be  necessary  in  preparing  schedules  and  out- 
lining the  work.  These  bring  an  outside  view  of  great  value. 
But  the  work  should  only  begin  with  such  a  survey.  The 
result  will  be  better,  the  information  more  accurate,  and  the 
general  education  of  the  force  far  greater  if  the  survey  and 
succeeding  job  analysis  are  made  gradually  and  as  part  of  the 
regular  work  of  an  established  employment  department. 

There  should,  however,  be  a  well-worked-out  plan  of  all 
personnel  features,  based  upon  a  labor  audit.  In  order  to 
visualize  the  plan,  the  work  to  be  done  for  a  considerable 
time  should  be  plotted.5  There  should  be  a  constant  flow  of 
information  to  the  cards  containing  the  job  specifications. 
Interviewers,  foremen,  plant  physicians,  complaint  department, 
all_whp^have  any  relations  to  a  job  should  be  continuously  on 
the-vtfatch  for  such  additional  information.  If  the  empIdymemT 
office  tests,  standardizes,  and  classifies  all  such  information, 
and  systematically  seeks  to  fill  in  all  gaps,  its  job  survey 
cards  will  become  the  foundation  of  all  employment  rela- 
tions. 

Job  Analysis 

Each  job  should,  as  soon  as  possible,  be  ^subjected  to  a 
careful  analysis,  according  to  standardized  specifications, 
especially  prepared  to  fit  the  industry  concerned.  A  complete 
and  typical  job  analysis,  according  to  Sumner  H.  Slichter, 
should  cover  the  following  points : 6 


'The  Labor  Audit,  Federal  Board  for  Vocational  Education,  Bulletin 
No.  43,  gives  full  instructions  for  making  a  labor  audit. 

'  S.  H.  Slichter,  The  Turnover  of  Factory  Labor,  pp.  284-289.  See  also, 
Outline  of  Job  Analysis,  by  E.  G.  Gould,  Iron  Age,  Apr.  1918,  p.  874,  for 
outline  used  by  War  Industries  Board. 


STANDARDIZING   THE  JOB  2$ 

1.  Natlirp  of  thft  jnb:  • 

(a)  Precise  nature  of  the  operation. 

(b)  Pay  for  beginners. 

(c)  Period  elapsing  before  advances  are  given  and  the 

amount  of  advances  if  a  regular  schedule  for 
advances  exists. 

(d)  The  amount  an  average  good  man  can  earn  on  the 

job. 

(e)  Time  required  by  an  average  good  man  to  attain 

normal  output. 

(f)  Opportunities  for  promotion;  names  of  the  specific 

operations  for  which  the  operative  is  in  line  for 
promotion,  and  their  rates  of  pay. 

(g)  Any  particularly   unattractive   features   about  the 

job,  such  as  great  physical  or  nervous  strain, 
heat,  dirt,  dust,  steam,  wetness,  nauseating  odors, 
monotony,  etc. 

2.  Characteristics  desired  of  the  workman: 

(TfJ^Occupations  within  the  plant  from  "which  workers 
are  to  be  drawn  in  preference  to  hiring  out- 
siders. 

(b)  Specific   physical   characteristics    required    of   the 

worker  such  as  great  strength,  good  eyesight, 
dexterity,  agility. 

(c)  In  the  case  of  some  jobs  physical  defects  which 

in  general  disqualify  applicants  will  not  be  a  bar. 
These  exceptions  to  general  rules  concerning 
physical  defects  are  specified. 

(d)  Special    knowledge,    skill,    experience   or    training 

necessary  or  desirable.  Names  of  occupations 
experience  in  which  specially  qualifies  men  for 
the  job. 

(e)  Mental    characteristics    required    of    the    worker, 

such  as  general  degree  of  intelligence  necessary, 
whether  high,  moderate  or  low,  and  special  men- 
tal characteristics  such  as  good  memory,  an  eye 
for  details,  quick  reaction,  etc. 

(f)  Requirements    relating    to    applicant's    personality 

and  character,  such  as  ability  to  meet  the  public ; 
in  the  case  of  workers  who  work  with  helpers, 


26  PERSONNEL   RELATIONS   IN  INDUSTRY 

tact  and  ability  to  get  on  with  others;  in  the 
case  of  positions  involving  considerable  respon- 
sibility,  even  though  perhaps  not  great  intelli- 
gence or  skill,  a  sense  of  responsibility, 
(g)  Age  limits,  if  any. 

As  time  passes  and  the  systematic  development  of  em- 
ployment methods  progresses  in  the  plant,  the  job  analysis 
tends  to  grow  more  and  more  minute.  Early  in  this  process 
a  set  of  questions  covering  the  points  mentioned  above,  and 
such  others  as  are  found  necessary  and  peculiar  to  each  plant 
or  department,  should  be  prepared.  These  should  be  furnished 
to  the  superintendents  and  foremen,  with  an  explanation  of 
their  purpose  and  value.  On  these  will  ultimately  be  based 
the  work  of  promotion,  of  trade  tests,  and  nearly  all  the  other 
work  of  the  personnel  department.  When  the  job  analysis 
is  sufficiently  complete  it  will  form  a  guide  to  the  instruction 
of  the  new  worker,  and  ultimately  the  foundation  of  trade 
education. 

Points  Covered  by  Job  Analysis 

A  job  analysis  is  not  a  character  analysis  of  the  desired 
applicant.  When  asked  what  kind  of  person  is  desired  to 
fill  a  certain  position,  the  employer  has  usually  given  a  list 
of  qualities,  such  as  intelligent,  patient,  careful,  loyal,  sincere, 
responsible,  etc.7  This  is  no  analysis  at  all.  It  is  only  another 


'"Anybody  can  make  a  hasty  tour  of  inspection,  gather  a  superficial 
knowledge  of  a  number  of  jobs,  and  then  describe  them  in  such  compre- 
hensive terms  as  those  just  enumerated.  .  .  .  These  qualities  are  so 
general  and  vague  that  they  mean  very  little  when  tied  up  with  a  particular 
job." — H.  C.  Link,  Employment  Psychology,  1919,  p.  256  et  seq. 

"It  is  clear  at  once  that  this  method  yields  little  information  of  the 
kind  we  are  considering  beyond  the  cataloging  of  the  general  virtues 
of  mankind.  .  .  .  The  so-called  special  qualifications,  such  as  honesty, 
patience,  attention,  neatness,  perseverance,  etc.,  do  not  represent  elementary 
psychological  categories.  Moreover,  they  are  qualifications  with  which  no 
legitimate  sphere  of  human  activity  can  afford  to  dispense.  In  the  long 
run  they  are  characteristics  which  correlate  to  a  high  degree  or,  indeed, 
perhaps  help  to  make  up  and  constitute  what  we  call  general  intelligence. 


STANDARDIZING  THE  JOB  27 

example  of  that  substitution  of  generalities  for  specific  re- 
search and  careful  testing  of  facts  which  has  long  character- 
ized the  conceit  that  passes  for  ability  in  the  field  of  man- 
agement. These  qualities  are  distinctive  of  no  job  and  prob- 
ably of  no  individual.  All  jobs  require  them;  all  persons 
possess  them  in  greater  or  less  degree.  They  are  qualities 
that  change  with  surroundings  in  the  person  and  are  in  no 
way  descriptive  of  the  job.  A  job  analysismust  be  specific. 
It_must  tell  the  processes  whic"H~constitute  th¥  jol 
that  can  describe  jioother  job.  It  must  describe  the  tools, 
methods,  and  technique  required  so  that  it  is  possible  for  any- 
one possessing  the  standardized  description  to  use  it  as  a  test 
for  the  selection  of  a  proper  person  to  fill  the  job.8 

Value  of  a  Job  Analysis 

A  job  analysis  is  of  value  in  relation  to  almost  every 
phase  of  employment  work.9     The  worker  is  the  first  one 


In  no  case  is  there  any  specification  of  the  precise  amount  of  these  various 
traits  that  may  be  needed.  Since  the  days  of  the  faculty  psychology  we 
have  ceased  to  think  of  memory,  will,  etc.,  as  homogeneous  powers  which 
play  in  a  general  sort  of  way  on  all  sorts  of  material.  We  usually  find 
that  when  an  individual  is  inattentive  to  one  set  of  facts  this  is  largely 
due  to  his  being  attentively  occupied  with  some  other  set.  Still  further, 
no  tests  have  been  proposed  which  satisfactorily  measure  such  traits  as 
honesty,  perseverance,  promptness.  Nor  is  it  certainly  known  to  what 
degree  such  traits  are  fixed  characteristics  of  individuals  and  to  what 
degree  they  represent  habits  and  tendencies  modifiable  in  many  ways  if  the 
circumstances  call  for  such  change." — H.  L.  Hollingworth,  Vocational 
Psychology,  1916,  pp.  99,  100. 

1  "Different  jobs  have  very  specific  and  characteristic  differences  and 
it  is  impossible  to  describe  them  except  in  terms  of  qualities  that 
are  equally  specific  and  concrete.  It  is  quite  apparent  that  the  personal 
qualities  of  a  worker  also  are  not  general  and  abstract,  but  are  particular 
and  very  closely  tied  up  with  the  specific  characteristics  of  a  particular 
job." — H.  C.  Link,  Employment  Psychology,  1919,  P-  257. 

*M.  R.  Lott,  Superintendent  of  Personnel  Department,  Sperry  Gyro- 
scope Company,  Standardizing  the  Job,  Factory,  Dec.  1919,  and  Jan.  and 
Feb.  1920. 

H.  A.  Kopf,  Report  on  Job  Analysis  to  "th  Annual  Conference 
National  Association  of  Corporation  Schools,  June  1919.  The  outline 
suggested  by  these  two  articles  is  followed  quite  closely  in  the  text.  See 
also  M.  T.  Copeland,  Business  Statistics,  1917,  p.  7. 


2S  PERSONNEL   RELATIONS    IN   INDUSTRY 

benefited.  If  the  work  has  been  properly  done,  he  is  assured 
of  being  placed  in  a  position  suited  to  his  abilities  as  a  crafts- 
man, his  physical  strength,  and  his  temperamental  character- 
istics. The  future  possibilities  of  promotion  can  be  made  vis- 
ible to  him,  as  the  requirements  for  all  higher  positions  are 
clearly  defined  and  in  available  form  for  consultation  at  any 
time.  Only  with  such  a  job  analysis  can  a  definite  plan  of 
promotion  be  worked  out  and  applied.  It  is  the  basis  of  the 
standardization  of  wages  for  identical  work,  the  lack  of  which 
is  a  prolific  source  of  dissatisfaction  and  turnover.  Without 
a  job  analysis  it  is  not  infrequent  to  find  the  same  work  being 
paid  for  at  very  different  rates,  not  only  in  the  same  locality, 
but  even  in  the  same  plant. 

The  firm  finds,  a  job  analysis  the  foundation  of  any  real, 
efficient  organization  of  the  human  forces  in  production.  The 
very  name  "organization"  presupposes  a  standardized  rela- 
tion of  elements.  The  job  is  perhaps  the  most  important  of 
such  elements.  Unless  the  job  is  standardized  through  analy- 
sis, there  is  only  a  chance  meeting  of  elements.  Only  when 
a  worker  is  properly  placed  can  he  efficiently  function  in  prt>- 
duction.  Only  by  a  thorough  job  analysis  is  the  establishment 
of  standards  of  payment  and  promotion  made  possible,  and 
such  standards  are  now  recognized  as  essential  to  industrial 
efficiency.  Modern  cost  accounting  rests  in  part  at  least  upon 
such  a  pay-roll  analysis  as  must  be  preceded  by  a  fundamental 
job  analysis.  All  these  things  that  work  together  for  better 
adjustment  make  for  a  lower  turnover  and  a  consequent  re- 
duction of  costs  of  production. 

Influence  on  Employment  or  Personnel  Work 

The  employment  or  personnel  department  of  any  organi- 
zation must  build  its  work  upon  a  job  analysis.  Such  a  de- 
partment cannot  be  really  organized  without  such  an  analysis. 
The  character  of  its  functioning  and  its  value  to  the  industry 


STANDARDIZING   THE   JOB  29 

will  be  largely  determined  by  the  thoroughness  of  the'  job 
analysis  upon  which  it  rests.  Without  such  an  analysis,  -se- 
lection is  blind  chance ;  interviewing  is  a  fishing  for  unknown 
facts  and  placing  a  lottery  with  very  few  prizes.  Job  analysis 
establishes  a  permanent  record  of  the  different  types  of  work ; 
gives  the  interviewer  reliable  data  upon  which  to  base  his 
questioning;  indicates  occupational  hazards,  conditions,  and 
rewards;  and  furnishes  the  information  necessary  for  the 
grading  of  jobs  for  promotion  as  well  as  the  first  placing  of 
employees.  It  makes  possible  the  utilization  of  the  physically 
handicapped  by  keeping  before  the  employment  manager  the 
lists  of  jobs  where  such  persons  can  be  used.  It  indicates 
where  and  what  training  is  necessary.  It  makes  possible  an 
analysis  of  turnover  by  jobs,  without  which  turnover  figures 
are  meaningless  and  the  search  for  remedies  almost  useless. 

A  job  analysis  reduces  friction  between  the  foreman  and 
the  employment  office  by  making  possible  exact  specifications 
for  employees.  Friction  in  human  relations  as  well  as  in  me- 
chanical ones  is  most  frequently  due  to  lack  of  standardization 
in  the  meshing  gears,  which  causes  them  to  bind  and  grind 
instead  of  smoothly  transferring  power  from  one  to  the  other. 
A  job  analysis  promotes  the  study  of  the  job,  and  discovers 
defects.  It  defines  the  factors  upon  which  output  depends 
and  points  the  way  to  increased  production. 

Job  Specification 

A  job  specification  is  the  result  of  a  job  analysis.  Such 
a  specification  made  by  the  foreman,  using  a  key-word  or 
number,  gives  instantly  a  complete  description  of  the  quali- 
fications required.  The  specification  can  be  written  in  a 
moment,  when  the  emergency  arises,  by  anyone.  It  utilizes  the 
accumulated  knowledge  of  months,  perhaps  years,  of  recorded 
investigation  concerning  the  job,  and  places  that  knowledge 
at  the  service  of  the  person  who  must  find  the  worker. 


3°  PERSONNEL   RELATIONS   IN   INDUSTRY 

A  novel  blank  to  be  used  with  a  job  specification,  an  ap- 
plication blank,  or  interviewer's  record,  has  been  suggested 
by  E.  H.  Bickley.10  This  blank  is  not  intended  to  take  the 
place  of  these  other  records,  but  may  be  placed  at  the  head 
of  any  form  of  foreman's  requisition  or  employment  office 
record,  as  a  means  of  summarizing  and  symbolizing  the  most 
important  information.  The  scheme  involves  two  parallel 
columns  as  follows: 

Very  good  eyes iX*  Good  eyes I 

Good  fingers 2X  Good  writing 28 

Strong  build 3X  Medium   build 3* 

Good  at  figuring 4X  Read  and  write 4* 

Right   handed 5X  Married    5 

Work  pedals 6X  Good   walker 6 

Good  hearing 7X$  Energetic    7 

For  special  trust 8X  Honest    8 

Very  skilled gX  Some  experience 9 

Pleasant   manner oX  Tactful    of 

The  characteristics  most  desirable  are  placed  in  the  first 
column,  and  those  possessed  by  the  applicant  or  desired  by 
the  foreman  are  checked.  The  qualifications  in  the  second 
column  are  considered  of  less  value  to  the  particular  firm  for 
which  the  record  is  prepared.  In  most  cases  they  are  a  less 
degree  of  the  qualities  expressed  in  the  first  column.  When 
the  blank  has  been  checked,  as  shown,  the  result  can  be  ex- 
pressed in  the  key  number  17.2340,  the  most  valuable  qualities 
being  placed  to  the  left  of  the  decimal  point.  The  card  can 
be  filed  by  this  number;  and  when  a  requisition  is  received, 
a  search  of  the  application  blanks  and  records  of  possible  em- 
ployees tells  at  once  if  anyone  with  the  required  qualifications 
is  available. 

Job  Standardization  on  National  Scale 

A  thorough  job  analysis  would  prove  of  great  help  to 
any  industry.  Several  national  and  local  associations  of  in- 


M  E.  H.  Bickley,  Records  that  Match  the  Man  to  the  Job,  Factory,  July, 
1918,  pp.  28-30. 


STANDARDIZING  THE  JOB  31 

dustries  are  already  preparing  to  make  such  an  analysis,  with- 
out which  it  is  now  recognized  there  can  be  no  common  lan- 
guage in  which  to  discuss  problems.  Only  when  terms  and 
conditions  are  standardized  will  intelligent  comparison  and 
consideration  of  difficulties  be  possible.  A  national  job  sur- 
vey and  analysis  would  be  the  first  step  to  the  standardization 
of  wages  throughout  a  trade.  This  would  minimize  the  labor 
turnover  due  to  purposeless  and  profitless  drifting  in  search 
of  differences  in  work  and  wages  which  either  do  not  exist 
or  must  tend  to  disappear  when  duties  and  requirements  of 
the  various  jobs  are  made  more  uniform. 

Suggestions  have  already  been  made  by  engineers  and 
others  in  a  position  to  speak  for  large  sections  of  industry 
that,  since  the  first  step  toward  job  standardization  on  a  na- 
tional scale  was  taken  by  the  government,  the  process  should 
be  continued  under  government  auspices,  with  the  co-opera- 
tion of  trade  associations.11  These  agencies  should  undertake 
the  work  of  selecting  standard  trade-names,  then  indexing, 
cross-indexing,  and  segregating  these  into  groups  of  allied 
trades.  This  would  also  include  defining  and  recording  the 
standard  requirements  of  the  trades,  and  classifying  the 
standards  of  skill.  Then  a  skilled  worker  in  any  trade  would 
mean  exactly  the  same  thing  in  all  places.  It  will  be  found 
that  important  steps  leading  in  this  direction  were  made  pos- 
sible by  the  development  of  trade  tests  in  the  army,  and  their 
application  to  industry.  This  matter  is  dealt  with  in  a  later 
chapter.12 

Frank  B.  Gilbreth  has  developed  another  phase  of  the  same 
idea  in  urging  that  motion  study  of  the  various  trades  be 
standardized,  so  that  the  operations  required  for  the  best 
standard  practice  may  be  recorded  and  classified  for  use  in 

11  M.  R.  Lott,  Standardizing  the  Job,  Factory,  Dec.  1919;  F.  B.  Gilbreth, 
Applied  Motion  Study,  1917,  pp.  I,  53-56. 
"  See  p.  100. 


S2  PERSONNEL  RELATIONS   IN   INDUSTRY 

industry  and  education.  He  believes  that:  "It  is  the  work 
of  the  United  States  Government  to  establish  such  a  Bureau 
of  Standardization  of  the  Mechanical  Trades.  The  standards 
there  derived  and  collected  would  be  public  property,  and 
original  investigators  could  invent  from  these  standards  up- 
wards. Most  important  of  all,  perhaps,  these  standards  would 
furnish  the  ideal  means  for  teaching  or  transferring  skill  to 
the  young  workers  who  desire  to  enter  a  trade." 13 


11 F.  B.  Gilbreth,  Applied  Motion  Study,  1917,  p.  56;  C.  R.  Richards, 
Director  of  Cooper  Union,  What  We  Know  about  Occupations,  in  Bloom- 
field's  Readings  in  Vocational  Guidance,  1915,  pp.  504-514,  gives  elaborate 
job  analyses  of  several  occupations  from  the  point  of  view  of  vocational 
guidance  and  urges  that  such  work  should  be  a  public  function.  See  also 
J.  M.  Brewer,  The  Vocational  Guidance  Movement,  1918,  pp.  130-137. 


CHAPTER  III 

STANDARDIZING  THE  ELEMENTS— HUMAN 
NATURE 

Two  Phases  of  the  Personnel  Problem 

A  job  is  a  position  for  a  human  being.  It  functions  only 
when  it  secures  the  services  of  some  person.  The  fundamental 
personnel  relation  is  that  of  the  person  to  the  job.  The  estab- 
lishment of  this  relation  includes  the  work  of  adjustment,  pro- 
motion, placing,  selection,  training.  It  rests  upon  a  mutual 
standardization  of  work  and  worker. 

Modern  industry  is  an  infinite  complex  of  persons  and 
positions.  Not  only  must  individuals  be  adjusted  to  jobs  but 
great  bodies  of  workers  must  be  adjusted  to  one  another. 
This  relation  of  persons  to  each  other  is  the  second  phase  of 
personnel  relations.  It  deals  with  questions  of  wages  and 
hours,  shop  conditions,  collective  bargaining,  welfare  work, 
joint  management,  employee  good- will,  systems  of  promotion 
and  discipline,  and  all  the  subjects  most  commonly  discussed 
under  the  name  of  "the  labor  problem." 

The  two  phases  are  not  entirely  distinct.  The  one  thing 
which  they  have  in  common  is  the  human  element — the  domi- 
nant element  in  industrial  management.  The  way  in  which 
men  are  fitted  to  jobs  will  have  much  to  do  with  the  absence 
of  friction  in  other  lines.  Industry  exists  for  persons  as  well 
as  by  means  of  persons.  The  problem  of  human  relations  in 
industry  is  largely  a  problem  of  psychology. 

Psychology  Applied  to  Industrial  Relations 

The  recognition  of  the  intimate  dependence  of  industry 

33 


34  PERSONNEL   RELATIONS   IN   INDUSTRY 

upon  psychology  is  very  recent.1  Hitherto  we  have  talked  of 
the  need  of  good  judges  of  human  nature,  of  recognizing  the 
human  elements,  and  similar  almost  meaningless  generalities. 
We  have  not  as  yet  attempted  to  analyze  these  phrases  into 
their  elements,  or  to  give  them  any  definite,  standard  mean- 
ing. 

One  of  the  reasons  for  this  neglect  is  undoubtedly  to  be 
found  in  the  fact  that  psychology,  from  which  alone  such  an 
analysis  can  be  expected,  has  itself  entered  into  this  field  only 
within  comparatively  recent  years.  The  gift  which  the  good 
fairy  Psychology  brought  to  the  christening  of  the  science 
of  personnel  relations  was  perhaps  the  most  valuable  of  all 
the  gifts  received,  but  it  was  not  complete.  The  science  of 
industrial  relations  was  born  before  Psychology  had  had  time 
to  put  the  finishing  touches  to  her  gift.2 

The  study  of  human  behavior  through  analysis  of  instincts 
and  habits,  and  the  examination  of  the  mind  by  experimental 
methods — the  two  phases  of  psychology  of  which  personnel 
relations  has  the  greatest  need — are  both  new  factors  of  in- 
vestigation. Neither  field  has  been  cultivated  for  much  more 
than  a  generation,  and  the  real  harvesting  has  been  done 
within  the  last  decade,  or  even  later. 

Of  the  developments  in  the  field  of  experimental 
psychology,  and  its  investigations  in  the  testing  of  mental 
and  trade  capacities  we  shall  have  much  to  say  later.  This 
work  promises  to  make  possible  a  standardization  of  the 
human  element  in  direct  relation  to  the  job.  But  the  second 


1  "The  whole  whirl  of  the  economic  world  is  ultimately  controlled  by 
the  purpose  of  satisfying  certain  physical  desires.  .  .  .  The  task  of  psycho- 
technics  is  accordingly  to  determine  by  exact  psychological  experiments 
how  this  mental  effect,  the  satisfaction  of  economic  desires,  can  be  secured 
in  the  quickest,  in  the  easiest,  in  the  safest,  in  the  most  enduring,  and  in  the 
most  satisfactory  way." — H.  Miinsterberg,  "Psychology  and  Industrial 
Efficiency,"  1913,  p.  244. 

a  H.  L.  Hollingworth  and  A.  T.  Poffenberger,  Applied  Psychology,  1917, 
pp.  10- 16. 


STANDARDIZING  HUMAN   ELEMENTS  35 

phase  of  our  subject,  the  direct  relation  of  human  beings  to 
each  other,  is  one  which  must  be  dealt  with  at  this  point. 
Here  we  must  draw  our  material  from  a  new  field  which  is 
yielding  a  rich,  but  as  yet  only  partially  gleaned  and  sifted 
harvest — the  field  of  "behavioristic  psychology."  Only 
within  very  recent  times  have  economists,  sociologists  and  all 
who  deal  with  the  great  field  of  human  nature  and  its  rela- 
tions stopped  to  ask,  What  is  "human  nature"  and  why  does 
it  behave  as  it  does? 

The  Elements  of  Human  Nature 

If  we  are  to  deal  with  human  relations  on  a  wide  scale, 
with  those  things  that  influence  the  behavior  of  human  beings 
in  masses,  we  must  manifestly  begin  with  an  analysis  of  that 
which  is  really  common  and  fundamental  in  human  nature. 
What  do  we  mean  by  these  words  ?  What  do  we  mean  when 
we  say  that  an  "understanding  of  human  nature"  is  so  greatly 
needed  in  industry  ? 

It  is  this  question  that  the  new  school  of  psychologists, 
aided  by  anthropologists,  sociologists,  educators,  economists, 
political  scientists,  and  all  other  scientists  whose  material  for 
investigation  is  composed  of  human  actions,  reactions,  and 
relations,  are  trying  to  solve. 

It  is  manifest  that  the  qualities  that  make  up  human  nature 
must  be  sought  in  the  most  primitive  elements  of  the  human 
mind.  E.  L.  Thorndike  describes  these  elements  for  which 
we  are  seeking  as  follows:8 

The  original  nature  of  man  is  roughly  what  is  common 
to  all  men  minus  all  adaptations  to  tools,  houses,  clothes, 
furniture,  words,  beliefs,  religions,  laws,  science,  the  arts, 
and  to  whatever  in  other  men's  behavior  is  due  to  adapta- 
tions to  them.  From  human  nature  as  we  find  it,  take 


•E.  L.  Thorndike,  The  Original  Nature  of  Man,  1914,  Vol.  I,  p.  198. 


36  PERSONNEL   RELATIONS   IN   INDUSTRY 

away  first,  all  that  is  in  the  European  but  not  in  the  China- 
man, all  that  is  in  the  Fiji  Islander  but  not  in  the  Esqui- 
maux, all  that  is  local  or  temporary.  Then  take  away  also 
the  effects  of  all  products  of  human  art.  What  is  left  of 
human  intellect  and  character  is  largely  original — not  wholly, 
for  all  these  elements  of  knowledge  which  we  call  ideas  and 
judgments  must  be  subtracted  from  his  responses.  Man 
originally  possesses  only  capacities  which,  after  a  given 
amount  of  education,  will  produce  ideas  and  judgments. 

The  Instincts 

By  far  the  most  important  elements  in  this  original  nature 
of  man  are  the  instincts.  These  run  far  back  below  any  his- 
torical period  for  their  origin.  They  have  been  fairly  con- 
stant under  all  civilizations.  Most  of  them  find  their  origin 
in  those  distant  prehuman  ages  with  which  the  geologist  and 
the  biologist  are  concerned,  and  are  shared  with  many  living 
creatures.  Civilization,  as  we  shall  see  further,  consists  largely 
in  bending  these  instincts  to  social  purposes,  and  their  resist- 
ance to  change  constitutes  one  of  the  reasons  for  the  slowness 
of  progress.  Even  more  of  that  slowness  and  the  difficulties 
that  accompany  it,  however,  may  perhaps  be  traced  to  igno- 
rance of  the  existence  and  method  of  operation  of  these 
instincts. 

Instincts  are  the  basic  things  in  human  make-up.  "Take 
away  these  instinctive  dispositions  with  their  powerful  im- 
pulses," says  McDougal,  "and  the  organism  would  become  in- 
capable of  activity  of  any  kind ;  it  would  lie  inert  and  motion- 
less like  a  wonderful  clockwork  whose  mainspring  had  been 
removed  or  a  steam-engine  whose  fires  had  been  drawn.  These 
impulses  are  the  mental  forces  that  maintain  and  shape  all  the 
life  of  individuals  and  societies,  and  in  them  we  are  con- 
fronted with  the  central  mystery  of  life  and  mind  and 
will."4 

*  William  McDougal,  Social  Psychology,  1917,  p.  44. 


STANDARDIZING  HUMAN   ELEMENTS  37 

The  Origin  of  Instincts 

Some  biologists  would  find  the  origin  of  instincts  in  cer- 
tain essential  properties  of  living  matter.  These  properties 
are  found  wherever  such  matter  exists  and  consist  of  ten- 
dencies called  "tropisms,"  according  to  which  such  living  mat- 
ter is  attracted  or  repulsed  by  light,  heat,  gravitation,  elec- 
tricity, presence  or  absence  of  other  objects,  and  so  forth. 
Such  movements  are  so  closely  analogous  to  those  which  affect 
inanimate  matter — chemical  affinity,  gravitation,  photo-chem- 
istry, etc. — that,  whatever  we  may  think  of  the  ultimate  and 
daring  conclusions  of  this  school  of  biologists,  we  must  agree 
that  in  tracing  even  a  similarity  in  instincts  back  to  chemical 
and  physical  reactions  they  have  shown  these  instincts  to  lie 
at  the  very  foundation  of  human  actions.6 

Functions  and  Laws  of  Operation 

Fortunately  the  use  of  this  knowledge  in  personnel  rela- 
tions is  not  greatly  affected  by  the  outcome  of  the  disputes 
over  the  exact  definitions  of  instincts.6  The  things  agreed 
upon  are  sufficient  for  our  purposes.  The  same  is  true  of  the 
divergent  classifications  of  instincts;  almost  any  of  them  will 
do.7  Nor  are  we  greatly  concerned  over  the  distinctions  be- 


*  Jacques  Loeb,  Physiology  of  the  Brain,  1900,  especially  Chap.  I. 

*  For  definitions  and  discussions  of  distinctions  see :  William  McDougal, 
Social  Psychology,  1917,  pp.  23,  24,  29;  Jacques  Loeb,  Physiology  of  the 
Brain,    1900,   pp.   6-8;   Ordway   Tead,   Instincts   in   Industry,    1918,   p.   5; 
Maurice   Parmalee,    Science   of   Human    Behavior,    1913,   p.   226;    E.   L. 
Thorndike,    Original    Nature    of    Man,    1914,    pp.    1-5;    William    Wundt, 
Lectures  on  Human  and  Animal  Psychology,  1901,  p.  395 ;  William  James, 
Psychology,  1902,  Vol.  II,  Chap.  24;  J.  B.  Watson,  Psychology  from  the 
Standpoint  of  a  Behaviorist,  1919,  pp.  194,  231  et  passim;  W.  B.  Pillsbury, 
The  Psychology  of  Nationality  and  Internationalism,  1919,  p.  25. 

T  "So  far  as  the  functioning  and  value  of  these  attitudes  to  the  organism, 
so  far  as  the  role  they  play  in  daily  life,  so  far  as  their  backward  and 
forward  reference  in  the  life  history  of  the  individual  are  concerned,  it 
makes  not  a  whit's  difference  what  factors  these  capacities  are  analyzable 
into." — J.  B.  Watson,  Psychology  from  the  Standpoint  of  a  Behaviorist, 
19I9»  P-  261.  For  classifications  see  authorities  previously  cited,  and 
Irving  Fisher,  Humanizing  Industry,  Annals  of  the  American  Academy, 


38  PERSONNEL   RELATIONS   IN   INDUSTRY 

tween  reflexes,  instincts,  habits,  and  even  emotions,  about 
which  psychologists  disagree.  The  disagreement  is  principally 
about  their  origin.  There  is  quite  general  agreement  as  to 
their  functions,  activities,  and  laws  of  operation.  These  are 
the  phases  that  bring  help  in  solving  the  problems  of  industry. 

There  is  the  instinct  of  gregariousness,  or  the  group  in- 
stinct. This  drives  or  draws  people  together  in  tribes,  mobs, 
armies,  clubs,  churches,  cities,  nations,  and  every  other  form 
of  social  group.  It  is  one  expression  of  that  "consciousness 
of  kind"  upon  which  Franklin  H.  Giddings  based  his  system 
of  sociology.8  It  is  responsible  for  many  group  actions,  and 
combined  with  imitation,  to  which  it  is  closely  allied,  produces 
fashions,  fads,  conventions,  and  similar  forms  of  group  ideas. 
In  modern  industry  this  instinct  becomes  of  great  importance 
in  determining  human  relations. 

Other  instincts  commonly  considered  as  sufficiently  differ- 
entiated to  require  separate  treatment  are  sex,  fear,  home- 
making,  migration,  revolt  against  confinement,  leadership, 
subordination,  display,  and,  for  our  purposes  perhaps  most 
important  of  all,  the  instinct  known  by  such  various  names  as 
manipulation,  creativeness,  constructiveness,  or  craftsmanship. 
Most  psychologists  consider  this  a  composite  of  various  in- 
stincts and  habits,  but  all  agree  that  in  human  beings  of  the 
present  day  it  usually  acts  as  a  unit  and  obeys  the  laws  that 
govern  instincts.9 

Slowness  of  Change  in  Instincts 

Fundamental  as  these  instincts  are,  they  are  subject  to 
change.  It  is  by  changing  them  and  building  institutions 


Mar.  1919,  pp.  83-90;  Carleton  Parker,  Motives  in  Economic  Life,  Ameri- 
can Economic  Review,  Vol.  VII,  pp.  212-231,  reprinted  in  his  Casual 
Laborer  and  Other  Essays. 

'Franklin  H.  Giddings,  Principles  of  Sociology,  1896,  Vol.  II,  Chap.  I. 

*J.  B.  Watson,  Psychology  from  the  Standpoint  of  a  Behaviorist,  1919, 
p.  260. 


STANDARDIZING   HUMAN   ELEMENTS  39 

to  utilize  their  energy  that  civilization  grows.  Around  the 
crude,  unrestrained,  animal  instinct  of  sex,  civilization  has 
built  the  family;  around  that  of  the  group,  the  mass  of  insti- 
tutions already  named.  In  so  doing  the  instincts  have  them- 
selves been  changed.  "The  original  nature  of  man  contains 
within  itself  a  principle  of  change,  and  the  circumstances  of 
the  life  led  by  modern  man  metamorphose  almost  every  origi- 
nal tendency  into  habits  which  are  much  unlike  it — even 
directly  contrary  to  it."  10 

It  is  no  reason  for  the  rejection  of  any  policy  that  it  is 
contrary  to  human  nature.  Most  of  the  gains  of  civilization 
came  through  such  changes.  Popular  speech  expresses  this  idea 
by  saying  that  moral  growth  depends  upon  the  suppression  of 
the  "old  Adam,"  or  by  triumphing  over  original  sin,  or  con- 
trolling the  carnal  nature. 

While  the  civilizing  process  involves  continuous  change 
of  human  nature,  this  should  not  blind  us  to  the  fact  that 
such  changes  are  exceedingly  slow  and  accompanied  with  dan- 
gers to  stability  and  outcome.  The  new  institutions  are  also 
subject  to  lapses  when  the  veneer  of  civilization  falls  off  and 
stark  human  instincts  gain  expression.  Nor  are  the  instincts 
to  be  looked  upon  as  something  evil  to  be  overcome.  They 
are  of  greatest  value.  "Instincts  to  their  modern  possessor," 
says  Carleton  H.  Parker,  "seem  unreasoning  and  unrational, 
and  often  embarrassing.  To  the  race,  however,  they  are  an 
efficient  and  tried  guide  to  conduct,  for  they  are  the  result 
of  endless  experiments  of  how  to  fight,  to  grow,  to  procreate, 
under  the  ruthless  valuing  mechanism  of  the  competition  for 
survival.  In  fact,  outside  of  some  relatively  unimportant 
bodily  attributes,  the  instincts  are  all  that  our  species  in  its 
long  evolution  has  considered  worth  saving.  .  .  .  Within  the 
past  ten  thousand  years  nothing  in  our  brilliant  experiment 


18  E.  L.  Thorndike,  Original  Nature  of  Man,  1914,  Vol.  I,  p.  143. 


40  PERSONNEL   RELATIONS   IN   INDUSTRY 

with  the  environment  called  civilization  has  been  long  enough 
adhered  to  to  bring  about  a  psychical  adjustment  capable  of 
physical  inheritance,  and  so  the  basic  motives  of  the  business 
man  today  remain  those  of  his  cave  ancestors."  u 

Influence  of  Method  of  Change 

It  is  the  method  of  change  that  is  of  greatest  importance 
in  social,  and  particularly  in  industrial,  relations.  One  reason 
for  the  divergent  classifications  of  instincts  seems  to  be  found 
in  the  probability  that  they  are  all  divisions  of  one  primal 
expression  of  energy.  One  school  of  psychologists — the 
psycho-analysts — have  designated  the  driving  force  that  finds 
expression  through  instinct  as  the  "libido."  In  describing 
what  is  meant  by  this  term  one  of  the  leading  representatives 
of  this  school  says : 12 

It  is  essentially  vital  impulse,  dynamic  in  character;  it 
is  source  as  well  as  stream.  In  the  course  of  life  there  is 
determination  of  libido  to  any  point  of  need.  It  is  available 
for  any  purpose  of  growth  and  development  and  repair.  It 
can  penetrate  every  recess  of  man's  being.  It  can  be  in  the 
conscious  or  unconscious.  Like  physical  energy  it  is  in- 
capable of  becoming  more  or  less,  hence  the  question  of  its 
application  and  availability  is  of  utmost  importance. 

One  may  think  of  libido  in  terms  of  man-power.  An 
attack  is  going  on  at  the  western  front,  it  is  to  that  front 
the  man-power  is  sent,  representing  the  available  libido. 
More  and  more  may  be  required,  and  so  long  as  more  is 
available  the  front  is  held,  but  not  without  weakening  and 

11  "Transitoriness  is  a  fact ;  instincts  do  wax  and  wane ;  but  the  waning 
is  far  less  frequent,  far  more  gradual  and  far  later  in  its  onset,  than  the 
ordinary  descriptions  of  stages,  epochs,  fluctuations  and  the  like  would 
lead  one  to  believe.  Much  of  human  behavior  can  be  explained  by  certain 
original  tendencies  which  wane  slowly  or  not  at  all,  except  in  so  far  as 
the  consequences  of  their  manifestations  stamp  them  out,  or  the  law  of 
disuse  slowly  weakens  them." — E.  L.  Thorndike,  Original  Nature  of  Man, 
1914,  Vol.  I,  p.  269. 

"Constance  Long,  An  Analytic  View  of  the  Basis  of  Character, 
Psycho-Analytic  Review,  Jan.  1920,  p.  4. 


STANDARDIZING  HUMAN  ELEMENTS  41 

risks  at  some  other  spot.  Hence  there  is  need  for  adapta- 
bility. Very  much  depends  not  only  on  the  quantity  of  man- 
power, but  on  its  mobility.  So  it  is  in  the  psychic  realm. 
There  is  plenty  of  libido  if  only  we  can  make  it  available 
for  our  purpose. 

John  B.  Watson,  professor  of  psychology  at  Johns  Hop- 
kins University,  criticizes  this  term  "libido"  and  suggests,  as 
conveying  the  same  meaning  in  a  much  more  popular  form, 
the  slang  word  "pep."  13  Each  person  has  about  so  much 
"pep"  which  drives  him  on  to  action  and  which  can  be 
directed  wherever  desired. 

Directing  Instinctive  Energy 

We  are  especially  concerned  with  the  laws  of  changing 
the  direction  of  instinctive  energy.  An  instinct  cannot  be 
suppressed  without  grave  dangers.  It  can  be  inhibited  in  one 
form  and  its  energy  turned  in  another  direction.  This  change, 
called  sublimation,  is  the  common  method  of  social  adapta- 
tion. The  instinct  of  acquisition,  once  expressed  in  the  "law 
of  tooth  and  claw,"  then  in  the  tactics  of  "robber  knights 
and  barons,"  then  in  unrestricted  competition,  fraud,  and  ex- 
ploitation, now  has  been  sublimated  into  regulated  industrial 
methods.  Other  instances  of  similar  evolution  have  already 
been  noted. 

An  attempt  at  suppression  without  an  alternative  oppor- 
tunity for  expression  is  apt  to  be  as  dangerous  for  the  sup- 
pressing force  as  it  would  be  for  a  person  to  sit  upon  the 
safety  valve  of  a  boiler  when  the  steam  was  not  being  ex- 
pended in  any  other  direction."  When  this  suppression  is 


UJ.  B.  Watson,  Psychology  from  the  Standpoint  of  a  Behaviorist,  1919, 
p.  181. 

4  "It  is  Freud's  theory  of  the  sublimation  of  the  instincts  that  most 
interests  the  sociologist.  Under  the  influences  of  social  control  the 
impulses  born  of  primitive  instincts  are  inhibited  and  the  energy  which 
is  restrained  from  its  normal  expression  is  expended  in  substitute  activ- 


42  PERSONNEL   RELATIONS    IN   INDUSTRY 

individual  it  often  finds  expression  in  unconventional  out- 
breaks, or  even  in  insanity.  Indeed  a  large  percentage  of 
the  insanity  not  traceable  to  physical  defects  is  now  thought 
to  be  due  to  this  cause.  When  the  instincts  of  people  in  the 
mass  are  suppressed  simultaneously,  the  resulting  outbreak  is 
apt  to  be  combined  through  the  group  instinct  into  some  anti- 
social action. 

Serious  as  suppression  is  to  the  individual,  its  dangers 
seem  to  increase  in  geometric  progression  where  whole 
groups  are  involved.  One  starving  man  standing  before  an 
open  fruit  store  may  be  a  potential  thief  of  a  crude,  petty 
sort;  a  thousand  starving  strikers  rushing  into  the  market 
place  can  be  a  goaded  mob  of  bedeviled  human  beings. 
Indeed  one  of  the  most  urgently  practical  lessons  which 
is  to  be  learned  from  a  study  of  applied  psychology  is  that 
many  aspects  of  the  labor  problem  today  present  pathological 
characteristics  because  of  the  suppression  of  one  or  another 
compelling  instinct.15 

Instincts  that  Bear  Upon  Industry 

Industry  has  special  need  of  the  instinct  of  gregariousness 
in  developing  group  solidarity  and  esprit  de  corps.  It  is  con- 
cerned with  the  instinct  of  acquisitiveness  in  all  wage  rela- 
tions, in  saving,  and  in  the  distribution  of  income.  It  touches 
closely  at  many  points  the  parental  or  home  instinct.  Industry 


ities.  An  instinct  which  has  been  inhibited  from  acting  directly  as  a  result 
of  the  social  pressure  of  modern  culture  attempts  to  find  its  indirect 
expression  and  when  successful  in  discovering  an  outlet  in  harmony  with 
the  demands  of  social  opinion  is  said  to  be  sublimated.  Human  society  is 
made  possible  by  this  sublimation,  and  each  person  who  becomes  a  member 
of  the  social  group  has  to  pass  through  the  experiences  of  conflict  between 
inner  instinctive  impulses  clamoring  for  gratification  and  the  pressure 
from  the  outward  social  environment  which  demands  from  the  individual 
what  seems  best  for  the  group  as  a  whole." — R.  A.  Groves,  Sociology  and 
Psycho-Analytic  Psychology,  American  Journal  of  Sociology,  Vol.  XXIII, 
pp.  112-113. 

"  Ordway  Tead,  Instincts  in  Industry,  1918,  p.  145.  See  also  C.  A. 
Ellwood,  Sociology  and  Modern  Social  Problems,  1913,  pp.  62-65;  and  C. 
H.  Parker,  The  Casual  Laborer  and  Other  Essays,  1920,  passim. 


STANDARDIZING  HUMAN   ELEMENTS  43 

might  make  great  use  of  the  instinct  of  leadership.  But  the 
one  basic  instinct,  the  neglect  of  which  has  threatened  our 
whole  industrial  life  and  the  proper  gratification  of  which 
is  essential  to  the  survival  of  a  civilization  based  upon  large- 
scale  machine  production,  is  the  instinct  of  manipulation, 
curiosity,  creation,  or  craftsmanship — as  it  is  variously 
named.  Of  this  instinct  William  James  says:16 

Constructiveness  is  as  genuine  and  irresistible  an  instinct 
in  man  as  in  the  bee  or  beaver.  Whatever  things  are  plastic 
to  his  hands,  those  things  he  must  remodel  into  shapes  of 
his  own,  and  the  result  of  his  modeling,  however  useless  it 
may  be,  gives  him  more  pleasure  than  the  original  thing. 

The  proper  sublimated  expression  of  this  instinct,  as  of 
all  others,  not  only  brings  pleasure  to  the  individual,  but  serves 
a  most  valuable  purpose  in  society.  Through  its  exercise 
nearly  all  other  instincts  are  gratified.  Watson,  who  like 
many  other  psychologists  considers  it  a  complex  of  several 
instincts  and  habits,  considers  that  it  "is  probably  the  most 
important  of  all  original  tendencies  in  view  of  the  fact  that 
nearly  all  later  habit  formations  are  dependent  upon  it."  " 
It  is  upon  this  characteristic  that  Thorstein  Veblen  bases  much 
of  his  economic  philosophy: 18 

The  position  of  the  instinct  of  workmanship  in  this  com- 
plex of  teleological  activities  is  somewhat  peculiar,  in  that 
its  functional  content  is  serviceability  for  the  ends  of  life 
whatever  these  ends  may  be ;  whereas  these  ends  to  be  sub- 
served are,  at  least  in  the  main,  appointed  and  made  worth 
while  by  the  various  other  instinctive  dispositions.  So  that 
this  instinct  may  in  some  sense  be  said  to  be  auxiliary  to  all 
the  rest,  to  be  concerned  with  the  ways  and  means  of  life 


"William  James,  Psychology,  1002,  Vol.  II,  p.  426. 

"  J.  B.  Watson,  Psychology  from  the  Standpoint  of  a  Behaviorist,  1919, 
p.  260.  Italics  in  original.  See  also  Maurice  Parmalee,  Science  of  Human 
Behavior,  1913,  p.  252. 

"Thorstein  Veblen,  Instinct  of  Workmanship,  1914,  p.  31. 


44  PERSONNEL   RELATIONS   IN   INDUSTRY 

rather  than  with  any  one  given  ulterior  end.  It  has  essen- 
tially to  do  with  proximate  rather  than  ulterior  ends.  Yet 
workmanship  is  none  the  less  an  object  of  attention  and  sen- 
timent in  its  own  right.  Efficient  use  of  the  means  at  hand 
and  adequate  management  of  the  resources  available  for  the 
purposes  of  life  is  itself  an  end  of  endeavor,  and  accom- 
plishment of  this  kind  is  a  source  of  gratification. 

Suppression  of  the  Instinct  of  Craftsmanship 

That  an  instinct  thus  endowed  with  a  double  appeal,  by 
its  own  demands  and  its  power  to  gratify  other  instincts, 
should  be  so  suppressed  that  the  most  frequent  indictment 
of  those  concerned  with  production  is  that  they  are  indifferent 
to  quality  and  quantity,  testifies  to  a  blunder  somewhere. 

The  suppression  of  the  instinct  of  craftsmanship  through 
monotonous  work,  lack  of  participation  in  planning,  irregu- 
larity of  employment,  arbitrary  management,  poor  adjust- 
ment of  workers  to  work,  indifference  to  character  of  output, 
and  many  other  features  of  modern  industry,  has  produced 
exactly  the  standard  reactions  that  are  always  found  in  such 
instinct  suppression.  The  energy  that  would  have  found 
expression  in  production  under  proper  conditions  turns  against 
the  struggling  instinct  and  finds  an  outlet  in  restriction  of 
output,  "ca'  canny,"  and  finally  in  such  violent  forms  as  sabot- 
age and  destruction  of  the  essentials  of  the  industry.  Such 
inversions  are  frequent  in  the  field  of  individual  insanity. 
Many  alienists  hold  that  we  are  now  confronted  with  a  similar 
phenomenon,  re-enforced  by  the  group  instinct,  upon  a  much 
wider  scale. 

If  industry  is  not  to  collapse  it  must  adjust  itself,  as 
society  has  always  done  in  the  past  if  it  svirvived,  so  as  to 
utilize  through  proper  institutions  this  powerful  and  essential 
instinct.  It  is  part  of  the  technique  of  the  science  "of  indus- 
trial relations  to  discover  the  means  by  which  such  institutions 
may  be  established. 


Standardization  of  Money  and   Materials 

Standardization  has  long  been  applied  to  money  and 
materials.  The  methods  and  the  machinery  of  obtaining 
credit,  of  raising  capital,  and  of  distributing  securities  are 
"among  the  most  completely  standardized  elements  of  our 
industrial  life.  Moreover,  there  is  only  one  kind  of  money 
to  be  sought  for.  It  has  been  a  long  time  since  money  in 
this  country  was  composed  of  a  variety  of  securities  a  knowl- 
edge of  which  was  essential  to  financing.  Such  variations 
were  once  universal ;  and  the  war  brought  a  recrudescence  of 
them  in  many  localities,  showing  the  disadvantages  accom- 
panying a  lack  of  standardization  in  such  an  important  matter. 

Materials,  also,  are  rapidly  becoming  standardized.  Their 
sources  are  fairly  well  known.  In  ordinary  times  the  ma- 
chinery for  their  selection  operates  with  little  friction  and 
the  methods  of  testing  them  are  well  established.  The  modern 
craftsman,  unlike  his  primitive  ancestor,  need  not  seek  his 
materials  from  forest  and  mine,  selecting  them  from  an  un- 
classified chaos  of  untested  substances. 

The  Labor  Supply  Not  Yet  Standardized 

The  labor  supply,  however,  is  still  the  entire  population 
of  the  earth,  unclassified,  untested,  and  unstandardized. 
American  industries  have,  at  some  time  or  other,  drawn  upon 
almost  every  section  of  this  supply.  If  the  person  who  is 
accustomed  to  employing  labor  on  a  large  scale  were  asked 
to  describe  the  mental  picture  that  the  words  "labor  force" 

45 


46  PERSONNEL   RELATIONS   IN   INDUSTRY 

raise  in  his  mind,  he  would  probably  describe  a  mob  of  un- 
skilled adults  with  variations  as  to  nationality,  customs,  men- 
tal abilities,  prejudices,  skill,  and  all  other  qualifications,  which 
in  general  would  run  the  whole  gamut  of  any  scale  of  measure- 
ments. Such  a  picture  was  long  one  that  could  be  seen  at 
almost  any  factory  door.  The  presence  of  this  supply  of 
unskilled,  unorganized  workers  has  been  one  of  the  determin- 
ing factors  in  the  conduct,  organization,  and  management 
of_Am_erican_  industry.  It  has  made  for  constant  change,  a 
large  turnover,  monotonous  automatic  labor,  the  drive  system 
of  management,  little  personal  relation  between  the  human 
elements,  disregard  of  apprenticeship  and  training  systems, 
and  a  social  stigma  on  labor.  It  led  to  the  idea  of  hiring 
and  firing  instead  of  adjustment  and  training.  While  the 
human  material  of  industry  represented  a  chaotic  mob  indus- 
trial relations  necessarily  lacked  order  and  efficiency. 

The  war,  with  its  destruction  of  men  and  material  and 
its  stoppage  of  immigration,  followed  by  a  recognition  of  the 
social  problems  that  were  aggravated  by  unrestricted  immi- 
gration, has  suddenly,  and  probably  permanently,  removed 
the  inexhaustible  reservoir  of  unemployed  and  unskilled 
adults.  Even  when  industry  slackens  it  is  doubtful  that  immi- 
gration will  ever  flow  as  freely  as  before,  or  that  great  armies 
of  the  unemployed  will  be  permitted  to  wander  about  the 
streets  looking  for  work  which  is  not  to  be  found. 

In  the  meantime  industry  is  still  confronted  with  the  fact 
that  it  must,  for  a  time  at  least,  draw  its  labor  force  largely 
from  unskilled  and  often  non-English-speaking  adults.  For 
some  years  to  come  personnel  relations  must  be  concerned 
with  the  classification  and  adjustment  of  this  mass. 

A  Cross-Section  of  Labor  Supply 

The  first  opportunity  to  get  a  view  of  a  real  cross-section 
of  this  labor  mass  came  with  the  examination  of  the  national 


SOURCES   OF  LABOR  SUPPLY  47 

army.  Even  then  there  had  been  a  crude  classification  before 
the  men  reached  the  camps.  Non-citizens  who  had  not  waived 
their  exemption  were  excluded,  as  were  the  most  evidently 
physical  defectives  and  there  were,  of  course,  no  representa- 
tives of  the  great  army  of  women  workers.  The  description 
of  such  a  cross-section  is  taken  from  the  "History  of  the 
Personnel  System  of  the  United  States  Army,"  issued  by  the 
Adjutant  General's  office  (Vol.  I,  page  9) : 

Ninety-eight  per  cent  of  the  recruits  sent  to  Camp  Taylor 
from  a  certain  district  in  Gary,  Indiana,  co.uld  not  under- 
stand the  English  language.  Six  per  cent  of  all  recruits 
claiming  trade  skill  actually  have  the  proficiency  of  experts 
in  their  trade.  .  .  .  About  half  of  one  per  cent  of  all  the 
recruits  are  so  stupid,  so  near  the  lower  border  line  of  intel- ' 
ligence,  that  they  cannot  learn  soldiering  at  all  and  have  to 
be  returned  to  their  homes.  Fifty-five  different  kinds  of 
chemists  and  chemical  workers,  and  forty-two  distinct  kinds 
of  machinists  required  by  the  Army  were  found  among  the 
men  in  the  receiving  camps.  Some  recruits  were  cowardly 
shirkers,  posing  as  conscientious  objectors;  others  really 
were  conscientious  objectors,  sane  and  sincere  but  deter- 
mined; still  others  were  equally  sincere,  perhaps,  but  so 
cranky  and  ego-centric  and  unstable  that  they  needed  to  be 
treated  like  borderline  cases  of  insanity.  At  Camp  Devens, 
Massachusetts,  and  Camp  Lewis,  Washington,  more  than 
twenty  per  cent  of  the  soldiers,  a  surprisingly  high  fraction 
of  the  total,  had  the  native  ability  and  high  intelligence  re- 
quired in  army  officers.  Thousands  of  the  new  soldiers 
were  physically  unfit  to  take  the  training  in  combat  units 
until  they  had  first  spent  some  weeks  in  the  Development 
Battalions. 

Classification  of  Labor  by  Locality 

The  classification  of  this  chaotic  labor  mass  takes  place 
today  by  a  series  of  stages,  largely  unconscious  and  uncertain 
in  their  results.  Making  this  classification  conscious,  intelli- 
gent, and  in  accordance  with  established  standards  that  guard 


48  PERSONNEL  RELATIONS   IN   INDUSTRY 

the  well-being  of  the  workers,  the  efficiency  of  industry,  and 
the  interests  of  the  social  whole  is  the  first  great  task  of 
scientific  personnel  management. 

The  first  rough  classification  depends  upon  the  location 
of  the  plant.  This  point  commonly  receives  much  less  atten- 
tion than  it  deserves.  Much  more  weight  is  apt  to  be  given 
to  the  source  of  raw  materials,  the  facilities  for  transportation, 
and  market  accessibility  than  to  labor  relations.  Even  in 
regard  to  these  material  and  mechanical  conditions  little  sys- 
tem has  been  used  until  within  recent  years.  The  managers 
of  some  of  the  systems  of  chain  stores  were  the  first  to 
standardize  the  market  element  in  retail  trade.  Before  one 
of  these  is  located  a  count  is  kept  for  several  days  of  the 
passers-by,  and  so  far  as  possible  they  are  classified  and 
grouped.  If  they  are  hurrying  past  to  catch  trains  in  the 
morning  and  evening  their  purchasing  value  is  much  less  than 
if  they  pass  the  place  regularly  throughout  the  day  as  a  part 
of  their  ordinary  work.  Tests  have  established  the  relative 
value  of  different  classes  of  crowds  and  standardized  formulas 
give  with  great  accuracy  the  trade  which  may  be  expected 
and  the  rent  which  can  be  profitably  paid. 

With  regard  to  the  labor  supply  in  determining  the  loca- 
tion of  a  plant,  the  reasoning  has  usually  followed  one  of 
two  lines.  Either  the  plant  is  placed  within,  or  in  the  suburbs 
of,  some  center  of  population  from  which  it  is  expected 
laborers  may  be  attracted;  or  it  is  placed  at  some  distance 
from  such  a  center  with  the  idea  that  the  workers  who  are 
then  brought  to  the  plant  will  be  bound  to  their  only  source 
of  employment  and  be  more  docile. 

It  is  easily  possible  to  make  this  classification  by  location 
effective  in  much  greater  detail.  Every  great  city  is  divided 
into  well-marked  sections  settled  by  groups  with  a  common 
interest  of  race,  trade,  economic  level,  or  other  principle  of 
gregarious  grouping.  Nearly  every  concern  wishes  to  draw 


SOURCES   OF  LABOR  SUPPLY  49 

its  personnel  mainly  from  some  one  of  these  groups,  unless 
it  is  still  so  antediluvian  in  policy  as  to  believe  that  greater 
effectiveness  can  be  obtained  by  a  heterogeneous  mixing  to 
prevent  solidarity  within  the  labor  group.  If  the  location  of 
the  plant  is  determined  by  the  proximity  to  the  sort  of  labor 
desired,  and  if  due  care  is  taken  to  assure  the  permanency  of 
the  neighborhood  grouping,  the  labor  turnover  will  be  greatly 
reduced  and  the  effective  organization  made  easier  from  many 
points  of  view. 

Neighborhood  Surveys 

A  neighborhood  job  survey  is  an  essential  preliminary  to 
the  intelligent  location  of  an  industry.  This  does  not  mean  a 
house  to  house  canvass.  Consultation  with  teachers,  ministers, 
old  residents,  tradesmen,  public  officials,  and  a  few  others, 
supplemented  by  personal  observation,  will  give  a  fairly  close 
knowledge  of  the  character  of  the  population  of  any  district. 
If  some  special  skill  is  required,  and  it  is  not  desired  to  estab- 
lish special  training  departments  in  the  plant,  then  it  is  impor- 
tant to  know  the  facilities  for  obtaining  such  skill.  What  do 
the  schools  offer?  What  is  the  prospect  of  their  expansion 
in  the  desired  trade  lines?  1 


1  "The  first  thing  I  would  do  if  I  were  confronted  with  such  a 
proposition  [locating  a  factory]  would  be  to  make  a  study  of  the  labor 
situation  in  that  locality  before  the  ground  was  broken.  The  first  thing 
I  would  do  would  be  to  take  up  the  question  of  the  labor  supply,  with  all 
the  existing  sources  of  labor  supply  at  that  time.  I  would  go  to  the 
labor  unions  and  raise  all  the  questions  in  advance  that  might  be  raised 
afterwards,  as  far  as  anyone  could  humanly  foresee  them.  Next  I  would 
show  that  in  so  far  as  there  were  any  unions  in  that  vicinity  connected 
with  those  trades — I  should  run  a  preferential  union  shop — I  would  appeal 
to  the  unions  for  men  before  I  appealed  to  anyone  else.  If  they  could 
give  the  men  I  wanted  I  would  take  them  in  preference  to  anybody  else. 
Then  I  would  say  that  I  would  pay  as  the  piece  rate  of  my  wages  the 
union  rate  in  that  vicinity,  regardless  of  whether  or  not  the  shop  was 
unionized.  And  any  other  methods  of  pay  would  have  to  be  built  on  that." 
— R.  G.  Valentine,  Scientific  Management  and  Organized  Labor,  Bulletin 
of  Taylor  Society,  Jan.  1915. 


50  PERSONNEL   RELATIONS    IN   INDUSTRY 

It  is  an  old  principle  of  trade  location  to  seek  a  group 
of  similar  industries  in  the  hope  of  obtaining  employees 
already  trained.  There  are  many  other  advantages  to  be 
found  in  such  industrial  grouping.  It  is  undoubtedly  true 
that  men  of  the  same  trade  tend  to  flock  together,  but  the 
principle  of  such  labor  recruiting  is  also  responsible  for  much 
of  the  present  useless,  wasteful,  and  harmful  labor  turnover. 
It  is  a  fact  that  most  employers  consciously  or  unconsciously 
expect  to  steal  the  skill  of  their  workers  from  their  com- 
petitors. Generations  have  laughed  at  the  story  of  the 
mythical  Yankee  schooner  whose  crew,  when  wrecked  upon 
a  desert  island,  became  rich  swapping  jack-knives.  Yet  em- 
ployers without  training  departments  are  operating  on  the 
same  plan.  Such  employers  have  left  behind  them  the  his- 
torical stage  when  raw  material  was  obtained  by  piratical 
raids,  and  even  that  more  recent  stage  when  similar  raids 
upon  public  resources  were  looked  upon  as  legitimate;  but 
they  still  believe  it  possible  to  conduct  a  business  by  securing 
trade  skill  which  they  have  not  helped  to  produce.  Such 
destructive,  competitive  recruiting  is  responsible  for  an  almost 
immeasurable  waste  and  is  a  prime  cause  of  the  present  large 
turnover.2 

Present  Methods  of  Securing  Labor 

This  wasteful  distribution  of  labor  is  caused  in  part  by 
reckless,  wholesale  advertising.  Until  a  better  instrument  of 
distribution  is  installed  in  this  country,  such  advertising  must 
sometimes  be  used.  But  it  is  only  another  example  of  whole- 
sale fishing  in  an  ocean  of  chaotic  elements,  in  the  hope  that 
proper  fish  will  be  secured.  Such  a  system  of  securing  labor 
can  have  no  logical  place  in  the  distribution  of  unskilled  and 


*  Proceedings  of  Employment  Managers'  Conference,  Rochester,  May, 
1918;  United  States  Bureau  Labor  Statistics,  Bulletin  No.  247,  pp.  55-88. 


SOURCES   OF   LABOR   SUPPLY  51 

the  commoner  skilled  trades,  though  it  is  possible  that  it  may 
long  be  found  useful  in  searching  for  labor  of  the  lowest 
grade. 

The  private  employment  office  operated  for  profit  is  an 
unmitigated  nuisance,  at  least  in  the  field  of  unskilled  and 
semiskilled  labor.  It  is  to  be  endured  only  because  of  the 
absence  of  properly  managed  public  offices.  Private  employ- 
ment offices  depend  upon  fees  incident  to  changes  in  positions. 
The  larger  the  turnover  the  greater  the  income  of  the  private 
employment  agent.  To  offer  the  highest  reward  for  the  most 
undesirable  feature  of  a  function  is  putting  a  greater  strain 
upon  the  acquisitive  instinct  than  the  interests  of  society 
should  permit 

The  story  is  told  of  one  such  private  employment  agency, 
that  in  the  time  of  the  most  pressing  demand  for  labor  during 
the  war,  it  delivered  a  train-load  of  men  to  one  plant,  after 
having  had  them  sign  application  blanks  for  jobs  in  another 
to  which  they  were  to  go  within  a  few  weeks,  paying  the 
agency  a  fee  for  both  positions.  I  have  personally  known 
such  agencies  to  furnish  section  hands  to  padrone  foremen 
with  the  understanding  that  the  men  were  to  be  discharged 
within  a  short  time  and  new  applications  filed,  the  fee  being 
divided  between  the  padrone  and  the  agency. 

Public  Employment  Offices 

The  natural  and  scientific  organ  for  a  proper  preliminary 
selection  should  be  an  employment  office.  Here  the  standards 
of  jobs,  skill,  and  other  broader  characteristics,  should  be 
established  for  entire  industries  and  the  entire  nation.3  This 
can  be  done  impartially,  and  with  the  full  confidence  of  all 
concerned,  only  by  a  publicly  operated  office. 

Public  employment  offices,  when  operated  by  the  politi- 

*See  pp.  238-239. 


52  PERSONNEL   RELATIONS   IN   INDUSTRY 

cians,  have  shown  a  tendency  to  become  mechanical  and  inef- 
fective. In  some  states  where  they  have  existed  for  years 
they  are  practically  useless.  In  Ohio  and  Wisconsin,  on  the 
other  hand,  they  have  played  an  important  part  in  the  dis- 
tribution of  labor.4  It  is  possible  that  if  such  offices  were 
placed  under  the  supervision  of  a  joint  board  chosen  by  the 
organizations  of  the  employers  and  the  employees,  who  would 
assist  in  the  management,  that  the  inefficiency  of  the  board 
would  be  removed.  This  would  also  insure  an  impartial 
standardization  of  jobs  and  skill  and  remove  that  suspicion 
which  is  otherwise  attached  to  the  actions  of  politicians. 

Formation  of  Labor  Reserve 

Within  each  plant  there  must  be  a  further  classification 
and  adjustment,  based  upon  co-ordination  of  all  sources  of 
supply.  This  classification  and  adjustment  must  be  made  with 
a.  view  to  permanent  relations  and  promotion  within  the  plant. 
The  foundation  of  this  work  must  be  the  formation  of  a 
classified  list  of  prospective  employees.  The  best  managed 
firms  of  today  have  already  learned  to  look  upon  such  a  list 
as  a  labor  reserve,  of  but  little  less  importance  in  successful 
management  then  an  analogous  financial  reserve.  A  list  of 
this  sort,  classified  and  kept  up  to  date  with  information 
steadily  accumulating  regarding  the  names  upon  it,  insures 
that  sound  foundation  upon  which  alone  an  effective  per- 
sonnel department  can  be  built. 

The  most  valuable  source  of  new  names  for  such  a  list 
-should  be  the  friends  of  present  employees.  Here  is  the  acid 
test  of  management  and  plant  popularity.  There  are  firms 
that  have  a  waiting  list,  even  at  the  peak  of  production. 
Others  are  always  complaining  because  they  cannot  secure 


*  J.  R.  Commons,  Industrial  Goodwill,  1919,  pp.  78-80.    D.  D.  Lescohier, 
The  Labor  Market,  1919,  Chaps.  VII-IX. 


SOURCES  OF  LABOR  SUPPLY  53 

workers.5  One  of  the  classic  tales  of  frontier  days  explains 
and  illustrates  the  reason  for  this  difficulty. 

As  a  prairie  schooner  came  to  the  edge  of  the  little  settle- 
ment its  driver  hailed  the  pioneer  at  the  first  cabin  door  with, 
"What  sort  of  place  is  this?" 

True  to  type,  the  answer  was  a  question,  "Whar  did  ye 
come  from,  stranger?" 

"Jest  a  ways  back  here  in  Ohio." 

"What  sort  of  place  was  it  thar?" 

"No  good.  Jest  a  lot  of  slanderous  backbitin'  gossips  that 
wouldn't  give  the  least  accommodation.  How  is  it  here?" 

"Jest  the  same,"  concluded  the  pioneer.  "You  might  as 
well  move  on." 

A  few  minutes  later  a  second  prospective  settler  from 
the  same  "back  East"  locality  came  in  sight,  and  the  con- 
versation quickly  reached  the  same  question,  "What  sort  of 
people  did  you  have  back  thar?" 

But  the  reply  was  different:  "A  fine  lot  of  folks,  kind, 
accommodatin',  and  helpful.  I  hated  to  leave  'em.  How  is 
it  here?" 

"The  same  sort,"  said  the  settler.  "You'd  better  stop  a 
while." 

Plans  for  Recruiting  Labor 

Factories,  like  frontiersmen,  take  their  neighbors  along. 
Some  always  have  disloyal,  lazy,  ungrateful  workers  and 


'  "The  natural  and  most  satisfactory  method  of  recruiting  new  workmen 
is  through  their  friends  and  acquaintances  already  employed  in  the 
establishment.  This  method  works  a  treble  benefit.  It  is  a  compliment  to 
the  worker  if  he  is  asked  to  recommend  somebody;  it  is  a  help  to  the 
employer  in  getting  a  good  selection  of  recruits;  and  it  is  a  help  to  the 
new  man  or  boy  in  getting  over  the  early  period  when  he  is  most  likely  to 
be  discouraged.  It  attaches  both  the  old  and  the  new  worker  to  the 
firm." — J.  R  Commons,  Industrial  Goodwill,  1919,  pp.  74,  75. 

W.  B.  Simmons,  president  of  the  Futurist  Company,  More  Applicants 
than  Jobs,  System,  Feb.  1920,  for  detailed  methods  of  direct  neighbor 
recruiting  of  employees  in  time  of  labor  scarcity. 


54  PERSONNEL    RELATIONS    IN   INDUSTRY 

others  have  the  reverse.  The  conclusion  and  the  effects  are 
inevitable.  If  present  employees  will  not  recommend  the  place 
to  their  friends,  then  they  do  not  wish  to  stay  themselves 
and  will  not  stay  long  nor  do  good  work  while  they  do  stay. 
If  such  good- will  exists/  there  are  many  ways  to  use  it  in 
building  up  a  list  of  prospective  employees.  Men,  and  even 
more,  women,  will  appreciate  being  asked  to  fill  a  vacancy 
from  among  their  friends.  We  all  prefer  to  work  with  those 
whom  we  know  and  like.  Persons  so  obtained  are  apt  to  be 
permanent  employees.  An  occasional  distribution  of  applica- 
tion blanks,  to  be  handed  to  friends  for  possible  future  use, 
not  only  helps  build  up  the  list  but  tests  the  feeling  in  the 
plant.  « 

Records  of  employees  leaving  should,  of  course,  be  kept. 
Everyone  likes  to  think  that  his  return  is  desired,  and  those 
who  return  will  appreciate  proof  that  they  have  not  been 
forgotten.  The  names  of  applicants  for  whom  there  is  no 
immediate  opening  also  belong  to  this  file.  A  large  and  suc- 
cessful^ department  store  in  Chicago  enjoins  its  employment 
department  to  send  every  rejected  applicant  away  a  friend  of 
the  store;  and  that  those  for  whom  there  are  no  present 
positions,  but  who  are  desirable  applicants,  are  always  to  be 
invited  to  fill  the  vacant  positions  before  the  concern  adver- 
tises for  help.  Moreover,  every  labor  union  maintains  a  list 
of  unemployed.  These  lists  should  be  consulted  when  avail- 
able, and  names  of  desirable  workers  learned  in  advance. 

It  will  be  noticed  that  all  such  plans  for  recruiting  labor 
are  based  upon  the  supposed  permanence  of  a  large  body 
of  idle  adults.  This  supposition  will  probably  be  henceforth 
contrary  to  fact.  The  mob  of  idle,  largely  unskilled,  unedu- 
cated, and  un-American  adults  which  has  so  long  constituted 
the  main  reservoir  of  labor  power  is  rightly  passing  away. 
It  should  never  have  come  into  existence.  An  unskilled  adult, 
and  especially  an  involuntarily  idle  one,  is  a  reflection  upon 


SOURCES   OF   LABOR   SUPPLY  55 

the  society  that  permitted  him  to  grow  up  without  skill,  and 
that  permits  him  to  seek  in  vain  for  an  opportunity  to  produce 
the  goods  of  which  that  society-is  in  need.  A  reserve  army 
of  unemployed  adults  large  enough  to  meet  the  growth  and 
changes  of  industry  implies  a  waste  which  should  be  intoler- 
able to  an  efficient  nation.  Its  existence  indicates  an  unhealthy, 
abnormal  situation. 

Natural  Sources  of  Labor  Supply 

/       •    i 
Every  society  has  a  natural  supply  of  new  workers  in 

the  youths  ready  to  leave  the  educational  system.  These 
constitute  the  largest  source  of .  industrial  recruits.  The  more 
enterprising  firms  are  already  forming  connections  with  this 
source.  The  National  Association  of  Corporation  'Schools' 
has  conducted  an  investigation  to  determine  the  "usefulness 
of  a  Central  Bureau  for  estimating  year  by  year  the  future 
requirements  of  corporations  for  technical  graduates,  and 
more  particularly  for  collecting  personal  data  concerning 
prospective  graduates  to  which  corporations  could  apply  for 
men."  This  report  recommended  an  elaborate  system  for 
collecting  such  information  concerning  students  in  advance 
of  graduation  as  would  facilitate  selection  and  placement. 
So  far  as  technical,  continuation,  and  trade  schools  are  con- 
cerned, the  connection  with  industry  is  already  close.  While 
there  is  much  opportunity  for  improvement  in  the  technique 
of  the  relations,  that  improvement  is  already  under  way. 

The  much  larger  number  of  graduates  from  grade  and 
high  schools  and  from  many  of  the  colleges  and  universities, 
together  with  the  still  larger  number  that  do  not  graduate 
from  any  of  these;  are  still  permitted  to  drift  aimlessly,  sub- 
ject to  all  the  uncharted  influences  of  industry,  in  the  hope 


'Report    7th   Annual    Conference,    National    Association    Corporation 
Schools,  June  1919,  pp.  121  el  seq. 


56  PERSONNEL  RELATIONS   IN  INDUSTRY 

that  they  will  in  some  way  become  related  to  the  industrial 
process.    Most  of  them  do,  but  at  a  tremendous  cost. 

Necessity  for  Vocational  Guidance 

Here  is  very  plainly  a  double  duty;  industry  must  make 
preparation  to  receive  the  youth,  and  the  school  must  prepare 
its  students  for  industry.  This  preparation  will  require  close 
co-operation  between  personnel  management  and  education. 
The  schools  are  preparing  for  their  work  through  the  move- 
ment known  as  "vocational  guidance."  The  activities  covered 
by  this  movement  are  described  by  one  of  the  leading  writers 
upon  it  as  follows:  7 

Giving  information  about  commerce  and  industry  in 
order  to  help  in  the  choice  of  an  occupation  or  a  job;  giving 
opportunity  to  discover  talents  with  the  vocational  choice  in 
mind;  advising  pupils  to  enter  this  or  that  school,  for  the 
purpose  of  discovering  their  talents  or  preparing  for  an 
occupation;  advising  in  regard  to  promotion,  change  of  job, 
after-education,  or  advanced  study ;  supervising  the  entrance 
into  or  progress  in  particular  positions  or  chosen  occupa- 
tions. t 

It  will  be  noticed  that  this  movement  overlaps  the  work 
of  personnel  management  in  industry  at  many  points.  This 
overlapping  does  not  necessarily  mean  duplication  of  work, 
but  should  bring  valuable  co-operation.8  Vocational  guidance 
approaches  the  subject  primarily  from  the  point  of  view  of 
the  welfare  of  the  prospective  worker,  and  -only  secondarily 
from  that  of  industry.  It  makes  its  own  elaborate  job  analy- 
ses, conducts  placement  bureaus  instead  of  employment 
bureaus  (the  distinction  is  suggestive  of  the  point  of  view), 
.and  follows  up  promotions  and  management  in  order  to  pro- 
tect and  assist  the  youth. 


TJ.  M.  Brewer,  Vocational  Guidance  Movement,  1918,  pp.  i,  2. 
'Ibid.,  p.  115. 


SOURCES   OF  LABOR  SUPPLY  57 

Vocational  guidance  naturally  finds  its  greatest  field  for 
work  in  connection  with  the  schools.  It  uses  the  same  methods 
of  testing  abilities,  has  its  own  application  blanks,  and  con- 
stantly meets  the  same  problems,  from  another  angle,  as  con- 
front the  employment  manager.  Already  this  has  led  to  a 
combination  of  effort  in  united  organizations,  and  to  a  co- 
operation that  must  grow  closer  as  time  passes.9  The  work 
is  reacting  upon  the  schools  and  transforming  them.  Just 
as  in  industry  it  is  becoming  evident  that  the  only  driving 
force  that  can  be  depended  upon  through  a  long  period  is 
the  instinct  of  workmanship  and  its  power  to  gratify  other 
instincts,  so  the  schools  are  learning  that  only  when  they  hitch 
education  to  industry  and  arouse  the  life-career  motive,  can 
the  best  educational  work  be  done.10  Here,  as  at  every  other 
point,  the  idea  of  gratifying  intelligently  trained  desire  and 
utilizing  suitable  ability  is  being  more  and  more  emphasized. 
Because  of  his  adjustment  to  his  right  place  in  industry  the 
worker  has  an  opportunity  to  grow  and  develop  throughout 
a  lifetime. 

Supervising  the  Worker's  Progress 

The  vocational  guide  does  not  end  his'  work  with  the 
placement  of  the  prospective  worker.  Indeed  there  is  a  ten- 
dency to  look  upon  this  work  as  of  least  importance.  First 
attention  should  be  given  to  preparation  for  the  position,  and 
then  to  supervision  after  entry  into  industry.  Nearly  every 
plan  provides  for  an  elaborate  investigation  .of  the  careers 


*  J.  M.  Brewer,  Vocational  Guidance  Movement,  1918,  p.  115. 

10  "We  ought  not  to  be  surprised  that  the  schools  which  avail  themselves 
of  this  strong  motive  get  the  best  work  from  their  pupils,  and  therefore 
do  the  best  work  for  the  community.  Indeed  the  hope  and  purpose  of 
improving  quality,  or  quantity,  or  both  in  our  daily  work,  with  the  inci- 
dental improvement  of  the  livelihood,  form  the  strongest  inducement  we 
adults  have  for  steady  productive  labor." — C.  W.  Elliot,  The  Value 
During  Education  of  the  Life-Career  Motive,  in  Bloomfield,  Readings  in 
Vocational  Guidance,  1915,  p.  4. 


58  PERSONNEL   RELATIONS    IN   INDUSTRY 

of  the  young  workers.  This  means  that  henceforth  a  power- 
ful influence  will  be  thrust  into  industry  from  the  side  of 
the  schools  for  the  protection  of  the  employees,  and  that 
industry  must  adjust  itself  to  this  influence.  E.  L.  Thorndike 
observes,  concerning  the  rapidly  growing  influence  of  workers 
in  vocational  guidance:  " 

This  new  officer  of  the  school  who  does  this  work,  medi- 
ating as  he  will  between  the  employers  and  the  employed, 
will  very  soon  become  important  in  connection  with  very 
many  other  relations  between  the  capitalist  and  the  laborer. 
This  new  school  officer — this  "vocational  guider" — will  ad- 
vise boys  and  girls  not  to  enter  certain  industries  or  certain 
trades,  or  even  not  to  enter  certain  individual  factories  or 
shops.  He  will  do  this  on  moral,  or  hygienic,  or  economic 
grounds. 

Educational  experiments  in  the  form  of  part-time  schools 
of  various  sorts,  and  of  almost  every  conceivable  form  of 
technical  and  trade  schools,  are  forming  other  bonds  of  close 
connection  between  the  factory  and  the  school.  They  all  tend 
to  forecast  the  approach  of  a  time  when  a  mob.of  idle,  unskilled 
adults  as  a  source  of  labor  supply  will  vanish,  to  be  replaced 
by  a  steady,  regulated  flow  of  youths  from  schools.  These 
will  come  trained  for  the  work  in  which  they  are  interested 
and  for  which  they  are  best  fitted.  For.  some  years  they 
will  be  advised  and  assisted  by  trained  school  officers,  ready 
to  help  in  rectifying  mistakes,  making  possible  changes  and 
new  starts,  and  bringing  to  bear  the  broader  knowledge  and 
trained  minds  that  will  be  of  help  to  the  employee.  While 
there  must  be  continuity  of  progress  and  permanence  for 
those  who  wish  it,  there  will  be  no  closed  walls  condemning 
anyone  to  life  imprisonment  at  hard  labor  in  a  trade  because 
of  an  ignorant  mistaken  choice  in  youth. 


"  E.  L.  Thorndike,  The  University  and  Vocational  Guidance,  in  Bloom- 
field,  Readings  in  Vocational  Guidance,  1915,  pp.  100,  101. 


SOURCES   OF   LABOR   SUPPL\  59 

Such  a  working  connection  between  trade  and  industry 
will  alter  every  feature  of  both  and  profoundly  affect  every 
problem  in  personnel  relations — a  fact  that  should  be  con- 
stantly kept  in  view  by  anyone  working  in  either  field. 


CHAPTER  V 

APPLICATION    BLANK— REFERENCES- 
INTERVIEWING 

Individual  Adjustment  to  Industry 

Any  analysis  of  the  labor  supply  should  aim  primarily  to 
further  a  proper  adjustment  between  the  worker  and  his  job, 
rather  than  to  select  and  reject  a  number  of  applicants.  In- 
dustry needs  every  person  capable  of  production  and  can 
use  nearly  every  adult  in  some  position.  The  only  justifiable 
ground  for  the  rejection  of  a  new  applicant  for  work  is  that 
the  person  rejected  would  be  injured  by  employment,  or  would 
injure  his  fellow-employees  or  society.  Establishments  that 
a  few  years  ago  were  hiring  a  small  percentage  of  applicants 
and  yet  had  a  turnover  of  400  and  500  per  cent,  now  boast 
of  their  ability  to  use  such  exceptional  classes  as  discharged 
convicts,  morons,  disabled  soldiers,  and  industrial  cripples, 
with  a  lower  turnover  and  improved  production.  The  special 
training  systems  established  during  the  war  and  the  rehabilita- 
tion work  of  reconstruction  have  revealed  hitherto  undreamed 
of  possibilities  in  the  development  of  human  capabilities. 

Every  step  in  the  choosing  and  placing  of  labor  should 
be  guided  by  the  constant  idea  of  permanence  and  promotion. 
An  efficient  employment  department  begins  to  plan  promotion 
with  the  first  interview.  It  views  every  person  who  enters 
the  plant  from  the  point  of  view  of  a  life  career  in  that 
plant. 

Basis  of  Proper  Adjustment 

Proper  adjustment  of  an  individual  to  industry  must  rest 
upon  a  series  of  judgments  as  to  abilities.  Unless  these  judg- 

60 


APPLICATION   BLANK;    INTERVIEWING  6l 

ments  in  turn  rest  upon  exact  knowledge,  they  will  not  be 
correct.  Such  exact  knowledge  can  be  obtained  only  by  means 
of  standardized  tests  to  determine  the  qualities  of  the  appli- 
cants. Qualities  thus  discovered  can  then  be  compared  with 
job  specifications,  as  determined  by  an  accurate  and  standard- 
ized job  analysis.  Only  such  an  accurate  and  dependable 
foundation  makes  possible  that  planning  of  placing  and 
promotion  which  insures  that  no  movement  in  the  personnel 
is  made  without  a  view  to  the  succeeding  step. 

Application  Blanks,  Old  and  New 

The  first  stage  in  selection  is  usually  the  filling  out  of  an 
application  blank.  The  older  form  of  application  blank  was 
a  maze  of  miscellaneous  questions — a  fish-net  in  which  to 
catch  all  possible  information  in  the  hope  that  some  of  it 
might  be  worth  saving.  Treatises  on  supposedly  scientific 
methods  of  hiring  contain  samples  of  such  blanks,  with  a 
hundred  or  more  questions.  Scientific  analysis  applied  to  such 
blanks  caused  a  rapid  shrinkage  in  size,  as  useless  questions 
were  weeded  out. 

The  essential  point  with  regard  to  any  question  for  an 
application  blank  is:  Will  the  proposed  question  reveal  the 
existence  of  a  quality  helpful  to  production?  The  object  of 
an  application  blank  is  to  find  out  the  things  the  applicant 
has  done  that  prepare  him  for  his  work,  and  to  record  his 
physical  and  mental  qualifications.  It  should  not  concern 
itself  with  what  he  likes  or  what  he  believes.  The  truth  is 
that  much  of  the  information  supposed  to  be  obtained  by 
the  older  methods  was  found  not  to  be  true  after  it  was 
recorded. 

The  Futility  of  "Character  Analysis" 

This  was  especially  true  of  attempts  to  make  a  "character 
analysis,"  by  means  of  such  questions  as:  "Who  is  your 


62  PERSONNEL   RELATIONS    IN   INDUSTRY 

favorite  movie  actor?"  "What  books  have  you  read?" 
"What  are  your  amusements?"  etc.  Long  lists  of  objects, 
actions,  and  characteristics  were  arranged  in  an  order  sup- 
posed to  compel  the  applicant,  in  the  process  of  checking  those 
he  preferred,  to  reveal  his  inmost  thoughts.1  All  this  lent  an 
air  of  mystery  and  wisdom  to  the  supposed  character  analyst, 
but  was  never  found  to  have  any  particular  connection  with 
production.  At  least,  there  are  no  records  of  the  superior 
productive  power  of  those  chosen  according  to  this  method. 
An  analysis  of  this  system  showed  that  it  traveled  in  a  circle 
and  never  arrived  at  the  destination  aimed  at.  Furthermore, 
as  it  was  concerned  with  a  changeable  matter — moral  char- 
acter— it  was  incapable  of  a  useful  or  permanent  course  of 
procedure. 

Concerning  such  questions  as,  "Can  you  manage  people 
well?"  and  "Do  you  like  to  be  with  people?"  Hugo  Miin- 
sterberg,  the  psychologist,  says:  "It  is  clear  that  the  replies 
to  questions  of  this  kind  can  be  of  psychological  value  only 
when  the  questioner  knows  beforehand  the  mind  of  the  youth, 
and  can  accordingly  judge  with  what  degree  of  understanding, 
sincerity  and  ability  the  circular  blanks  have  been  filled  out. 
But  as  the  questions  are  put  for  the  very  purpose  of  revealing 
personality,  the  entire  effort  tends  to  move  in  a  circle.  To 
break  this  circle,  it  indeed  becomes  necessary  to  emancipate 
oneself  from  the  method  of  ordinary  self -observation  and  to 
replace  it  by  objective  experiment  in  the  psychological  labora- 
tory." 2 

Uselessness  of  Certain  Queries 

The  absurdity  of  such  questions  becomes  evident  when 
they  are  robbed  of  camouflage  and  stated  baldly.  The  real 


1  Fritz  Kemble,   Choosing  Employees  by  Mental   and  Physical   Tests, 
*7>  PP-  55-6i ;  Frank  Parsons,  Choosing  a  Vocation,  1909,  pp.  26-46,  give 

samples  of  such  blanks  in  two  allied  fields  of  selection. 

2  Hugo  Miinsterberg,  Psychology  and  Industrial  Efficiency,  1913,  p.  45. 


APPLICATION   BLANK;    INTERVIEWING  63 

information  sought  is  a  truthful  reply  to  the  question,  "Are 
you  lying?"  Both  the  liar  and  the  truthful  person  would 
answer  "No,"  unless,  perhaps,  the  latter  were  barred  by 
modesty,  which  introduces  just  enough  uncertainty  into  the 
matter  to  make  it  a  subject  for  the  fortune-telling,  gambling 
method  of  character  judgment.  The  presence  of  the  modesty 
element  may  have  been  responsible  for  the  experience  of 
Charles  P.  Avery,  of  Marshall  Field  and  Company,  who  noted 
that,  "One  such  form  was  returned  to  the  superintendent  with 
the  astonishing  but  befitting  notation,  'Self-praise  is  no  recom- 
mendation.' ' 

But  the  effort  to  probe  into  character  is  too  fascinating 
to  be  easily  given  up.  While  the  more  evidently  useless  ques- 
tions have  been  removed  from  most  application  blanks,  there 
are  still  many  that  ask  the  prospective  employee  to  "place 
a  check  mark  after  such  of  the  following  words  as  most 
clearly  apply  to  himself."  Then  follow  some  thirty  or  forty 
terms,  such  as,  careful,  cautious,  courteous,  patient,  cheerful. 
Aside  from  the  inability  of  the  individual  to  analyze  himself, 
there  is  the  further  difficulty  that  a  correct  analysis  at  one 
time,  in  relation  to  one  set  of  conditions,  would  be  false  in 
relation  to  a  multitude  of  others.  No  one  person  is  careful 
at  all  times.  All  of  us  are  sometimes  incautious;  if  we  were 
not  it  would  be  much  the  worse  for  the  world.  Patience  and 
cheerfulness  are  even  more  dependent  upon  conditions. 

Although  these  facts  concerning  the  instability  of  char- 
acter, the  inaccuracy  of  self-analysis,  and  the  uselessness  of 
such  misleading  information  in  determining  fitness  for  work 
were  quite  well  understood  at  the  time  this  nation  entered 
the  war,  yet  even  the  highly  trained  experts  who  had  charge 
of  the  Department  of  Personnel  could  not  wholly  escape  tradi- 
tional methods.  In  the  beginning  a  form  was  used  which 
called  "for  an  estimate  of  the  man's  (a)  trustworthiness,  (b) 
general  intelligence,  (c)  ability  to  supervise  and  direct  men, 


64  PERSONNEL   RELATIONS   IN   INDUSTRY 

(d)  ability  to  work  with  others,  (e)  his  skill  as  a (trade 

entered  on  blank),  and  (f)  the  general  estimate  of  the  man's 
character  and  qualifications."  But  we  also  learn  that,  "The 
blank  was  never  used  except  in  one  camp,  and  no  particular 
value  was  found  for  it  there."  3 

Of  still  other  methods,  which  sought  through  references 
to  previous  employers  and  a  grading  scale  to  determine  similar 
indefinite  characteristics,  the  report  says:  "This  system  was 
utilized  in  classifying  thousands  of  men  but  soon  fell  into 
disuse  when  it  became  apparent  that  interviewers  showed 
great  differences  in  the  way  in  which  they  would  rate  the 
same  man."  * 

Essential  Queries 

By  this  road  of  experience,  tested,  by  results,  the  conclusion 
has  been  reached  that  an  application  blank  should  confine 
itself  to  facts  that  are  susceptible  of  test  and  standardization. 
It  should  contain  names,  addresses,  education,  technical  train- 
ing, previous  occupational  experience,  and  such  other  facts 
as  experience  proves  will  aid  in  adjusting  the  applicant  to 
the  job.  The  standard  to  be  followed  is:  record  only  tested, 
or  at  least  verifiable  facts,  having  direct  relation  to  production. 

'"uTTrrnrr-* -  •    ^^  ••—  • 

Standard  for  Evaluating  References 

The  attempt  to  base  action  upon  opinion  extends  to  the 
use  of  references.  These  are  usually  filled  with  meaningless 
generalities,  which  cover  up  lack  of  exact  knowledge  and  dis- 
inclination to  make  the  exertion  necessary  to  procure  it.  A 
reference,  to  be  of  any  value,  must  tell  just  what  the  employee 
did  in  his  previous  position.  This  should  be  made  as  easy 
as  possible  by  a  standard  letter  of  inquiry.  Such  a  letter 


1  The  Personnel  System  of  the  United  States  Army,  Vol.  I,  p.  137. 
*The  Personnel  System  of  the  United  States  Army,  Vol.  I,  p.  139. 


APPLICATION  BLANK;  INTERVIEWING  65 

was  developed  in  the  personnel  division  of  the  army,5  and 
a  variation  for  industry  is  proposed  by  its  originator,  Pro- 
fessor Walter  Dill  Scott.6  Its  principal  advantage  is  in  the 
style  and  system  of  checking,  which  makes  such  information 
as  is  received  easily  classifiable.  , 

Employment  managers  are  beginning  to  question  whether 
the  information  obtained  from  references  is  really  of  much 
value.  They  contain  certain  inherent  defects  which  cause 
them  to  mislead  almost  as  often  as  to  help.  Success  or  failure 
in  one  position  is  not  always  duplicated  in  another.  If  it 
were,  most  of  us  would  long  ago  have  become  glorious  suc- 
cesses or  abject  failures.  We  all  succeed  many  times  and 
fail  many  times,  and  often  gain  as  much  from  the  failures 
as  from  the  successes.  Even  a  discharge  for  incompetency 
or  other  cause  should  be  looked  upon  as  a  punishment  for 
one  delinquency,  and  in  industry  no  more  than  in  law  should 
a  "person  be  twice  put  in  jeopardy  for  the  same  offence." 

A  reference  from  a  plant  without  an  organized  employ- 
ment department  lacks  force  for  still  other  reasons.  Every 


employment  manager  knows  how  difficult  it  is  to  apportion 
blame  in  the  constant  controversies  between  foremen  qnd 
employees!  Therefore  a  reference  from  an  organization 
where  no  impartial  body  exists,  is  bound  to  be  an  ex  parte 
statement.  References  are  of  much  greater  value  from  estab- 
li shments  where  a  properly  organized  employment  department 
includes  a  division  for  impartial  investigation  of  grievances. 
References  often  come  from  the  head  of  a  firm,  who  knows 
jittle  of  the  actual  work  of  the  employee.  It  is  seldom  that 
the  foreman  in  direct  charge  of  the  work  is  reached,  and 
even  more  seldom  that  he  is  an  impartial  judge. 


*  The  Personnel  System  of  the  United  States  Army,  Vol.  I,  p.  138. 
'Annals  of  the  American  Academy,  No.  154,  pp.  183,  184;  also  S.  H. 
Slichter,  Turnover  of  Factory  Labor,  1919,  pp.  312,  313. 


66  PERSONNEL  RELATIONS   IN  INDUSTRY 

Interviewing  the  Applicant 

When  the  prospective  employee  does  not  fill  out  his  own 
application  blank,  its  preparation  is  a  part  of  the  work  of 
interviewing.  This  procedure  is  necessary  when  hiring 
illiterates,  though  it  has  the  disadvantage  that  one  possible 
chance  of  checking  up  errors  in  judgment  and  fact  is  thus 
eliminated.  "Carefulness  and  thoroughness  in  interviewing 
is  the  principle  thing  which  distinguishes  high-grade  practice 
from  poor,"  says  Slichter.7  Proper  interviewing  requires  prep- 
aration and  training  on  the  part  of  the  interviewer.  It 
replaces  impressions,  guesses,  and  estimates  of  human  nature 
with  systematic  questioning  to  obtain  definite  information. 
Because  such  careful,  systematic  work  is  difficult,  because  it 
requires  study  and  affords  no  opportunity  to  display  ability 
as_a_Judge  of  human  nature,  there  has  been  a  tendency  to 
substitute  a  sort  of  mystical  fortune-telling  system  called 

"physiognomy."^ 

f  ~ 

The  Pseudo-Science  of  Physiognomy 

This  alleged  science  purports  to  teach  an  interviewer  how 
to  tell  the  character  of  an  applicant  by  the  color  of  his  hair, 
the  texture  of  his  skin,  the  concavity  or  convexity  of  his 
face,  and  similar  superficial  characteristics.  It  is  not  some- 
thing new,  in  course  of  development.  Physiognomy  is  thou- 
sands of  years  old  and  always  was  a  fake.  Its  every  phase 
has  been  tested  by  thousands  of  experiments  and  always^ 
proved  useless  and  deceptive.  Under  various  disguises,  it  has 
deluded  anthropologists  and  criminologists.  It  was  the  basis 
of  the  famous  "dolichocephalic  blond"  theory  that  contributed 
to  the  doctrine  of  the  superiority  of  the  Teutonic  race.  In 
one  form  or  another  it  has  been  used  to  prove  the  superiority 
of  every  race.  Every  suggested  correlation  between^physical 


TS.  H.  Slichter,  Turnover  of  Factory  Labor,  1919,  p.  302. 


APPLICATION  BLANK;  INTERVIEWING  67 

appearance  and  mental  abilities  has  been  tested  out  and  its 
falsity  exposed  many  times.8 

Concerning  the  attempts  to  use  this  hoary  fraud  in  the 
field  of  vocational  guidance,  John  M.  Brewer  well  says: 9 

The  fourth  kind  of  questionable  guidance  is  based  on 
an  exaggeration  of  the  importance  of  physical  characteris- 
tics. .  .  .  There  are  courses  for  business  men  in  which 
blonds  and  brunettes,  brown  eyes  and  blue,  aquiline  faces, 
small  lips  and  tapering  hands  are  discussed  in  their  voca- 
tional significance.  It  is  supposed  that  employment  managers 
can  by  this  means  find  short  cuts  to  "size  up"  applicants 
and  tell  which  to  hire  and  which  to  reject.  Current  maga- 
zines are  supplied  with  the  advertisements  of  the  people 
who  furnish  such  information.  .  .  .  The  effect  of  these  ex- 
periments goes  deeper  than  mere  loss  of  money  and  disap- 
pointment; it  involves  the  injustice  of  misjudging  men. 
This  teaching  goes  on  in  spite  of  the  fact  that  not  even 
criminals  can  be  discovered  by  their  faces;  if  they  were 
the  work  of  detectives  would  be  easier. 

Methods  of  Physiognomy  Fakers 

The  methods  by  which  this  pseudo-science  is  exploited  are 
those  that  always  characterize  the  faker.  Its  advertising 
retains  all  the  features  that  marked  the  methods  of  the  man 
with  the  gasoline  torch  who  visited  the  small  town  in  our 
boyhood  days,  selling  bottles  full  of  the  marvelous  remedy 
guaranteed  to  cure  anything  from  dyspepsia  to  baldness, 
toothache,  or  corns.  One  such  firm  advertises  that  its  grad- 
uates have  selected  "during  the  past  year"  (but  date  of  year 
not  given)  12,000  employees  without  a  single  mistake.  But 

*"So  far  as  phrenology  and  physiognomy  are  concerned  they  should 
be  regarded  not,  as  some  employment  managers  mistakenly  view  them 
to-day,  as  sciences  in  their  infancy,  but  as  pseudo-sciences  hoary  with  age 
and  in  the  main,  due  to  their  high  percentage  of  error,  neglected  because 
untrustworthy." — E.  B.  Gowin,  Selection  and  Training  of  the  Business 
Executive,  1918,  pp.  70-73. 

*  J.  M.  Brewer,  The  Vocational  Guidance  Movement,  1918,  pp.  165,  167. 


68  PERSONNEL  RELATIONS   IN   INDUSTRY 

there  is  no  mention  of  how  error  was  tested.  We  are  not 
told,  with  names  of  firms  and  territory  covered,  that  100 
blonds  were  chosen  as  salesmen  and  sent  out  in  equal  com- 
petition with  100  brunettes,  with  details  of  comparative  sales. 
The  worker  in  the  field  of  personnel  relations  should 
beware  of  the  peddlers  of  panaceas.  There  are  no  short-cuts. 
Shun  those  who  use  the  terms,  methods,  or  phraseology  of 
discarded  sciences,  or  the  discarded  methods  of  present 
sciences.  The  methods  and  phraseology  are  easy  to  learn, 
"make  a  noise  like  wisdom,"  and  are  the  patter  with  which 
the  sleight-of-hand  artist  entertains  his  victims.  Avoid  hints 
of  the  mysterious.  The  gold  brick  is  carefully  hidden;  the 
receipts  for  the  patent  medicine  came  from  some  secret  source ; 
always  the  victim  is  to  be  let  in  on  the  ground  floor  to  some 
knowledge  not  commonly  available.  It  should  be  said  once 
for  all  that  no  facts  or  rules  unfamiliar  to  all  psychologists 
are  to  be  found  in  any  mental  or  psychological  system,  or  in 
any  advertised  course  of  training  for  memory,  or  anything 
else,  and  that  these  systems  seldom  contain  anything  that  is 
both  new  and  true. 

Character  Reading  versus  Facts 

Schemes  for  character  reading  are  especially  apt  to  deceive 
because  they  cater  to  what  has  hitherto  been  the  customary 
method  of  choosing  employees.  Employment  managers  have 
been  selected  because  they  were  presumably  good  judges  of^ 
Human  nature.  We  are  analyzing  human  nature  into  a  chang- 
ing complex  of  capacities,  abilities,  instincts,  habits,  impulses, 
hopes,  and  many  other  elements.  We  are  developing  ways 
of  testing  thejrglative^  strength  and  value  of  some  ot  these. 
We  are  also  discovering  that  the  very  characteristics  which 
the  old  intuitive  methods  pretended  to  measure  are  just  the  ones 
least  capable  of  measurement,  and  the  least  permanent.  We 
know  that  character,  so-called,  is  something  that  changes  more 


APPLICATION  BLANK;  INTERVIEWING  69 

readily  and  suddenly  than  almost  any  other  part  of  man's 
mental  make-up.  If  this  were  not  true,  much  of  the  dramatic 
in  literature  would  be  rejected  as  untrue  to  life  and  the  exist- 
ence of  religious  conversions  would  be  impossible. 

In  spite  of  these  facts,  the  attempt  to  judge  character  will 
probably  never  be  entirely  given  up.  Indeed  it  is  impossible 
to  avoid  so-called  intuitions.10  They  can  only  be  warned 
against  as  the  least  reliable  of  all  the  information  that  will 
be  gained  during  the  interview.  Any  conclusion  that  is  just 
andfair  to  use  i"  pasg1'ng^j"^Tnp™t-_npnn  a_human  being 
should  rest  upon  tested,  sta.nHarHiy.pH  fartg  This  rule  is  the 
basis  of  the  elaborate  civil  and  criminal  court  practice  that 

10  The  difficulties  of  judging  character  lead  so  able  and  careful  a  writer 
as  S.  H.  Slichter  to  the  following  contradictory  positions : 

"Fully  as  important  as  the  specific  information  given  by  the  applicant 
is  the  impression  gained  of  his  character.  The  estimation  of  the  character 
of  applicants,  however,  probably  constitutes  the  least  satisfactory  phase 
of  interviewing  practice. 

"The  specific  qualities  of  character  in  which  the  interviewer  is  most 
interested  include  honesty,  frankness,  intelligence,  earnestness,  whether  the 
applicant  is  a  man  of  definite  aim,  whether  he  understands  the  meaning 
of  responsibility,  whether  he  is  industrious,  painstaking,  willing  to  do 
what  he  is  told,  appreciative  of  good  treatment,  whether  he  responds  to 
it  with  loyalty,  whether  he  is  willing  to  cooperate  with  others,  whether  he 
is  of  agreeable  personality  and  likely  to  get  on  well  with  his  associates. 

"There  is  no  reliable  evidence  of  these  traits.  External  manner  and 
appearances,  features,  facial  expression,  handshake,  clothes,  attitude  toward 
filling  out  the  application  blank,  attitude  towards  the  questions  asked 
him  and  character  of  his  answers  are  all  misleading.  .  .  .  The  interviewer 
seeks  to  penetrate  beneath  these  externals  and  to  see  what  is  really  there. 
He  arrives  at  his  conclusion,  however,  not  as  a  result  of  a  process  of 
conscious  and  systematic  analysis  of  the  applicant  but  in  the  same  way 
that  men  generally  do,  as  a  result  of  intuition.  Intuitively  he  feels  either 
that  the  applicant  is  a  desirable  or  an  undesirable  sort.  Upon  the  sound- 
ness of  his  intuition  depends  his  reliability  as  a  judge  of  men." — S.  H. 
Slichter,  Turnover  of  Factory  Labor,  1919,  pp.  309,  310. 

It  would  seem  that  a  method  so  unsatisfactory  and  unscientific  had 
better  be  discarded  rather  than  followed,  and  that  where  facts  are  all 
misleading  intuition  is  hardly  a  safe  guide. 

"Any  psychologist  at  the  present  time  who  claims  he  can  pick  out 
defective  individuals  from  normals  by  means  of  photographs  or  even 
by  mere  immediate  visual  inspection  would  lose  respect  of  his  colleague's." 
— J.  B.  Watson,  Psychology  from  the  Standpoint  of  a  Behaviorist,  1919, 
pp.  406,  407.  Watson  gives,  pp.  227-228,  an  outline  for  measuring 
emotional  balance  and  relations  which  is  suggestive  of  the  lines  scientific 
progress  is  taking. 


7°  PERSONNEL   RELATIONS   IN  INDUSTRY 

has  been  built  up  through  the  centuries.  It  is  the  duty  of  the 
interviewer  to  get  the  essential  facts  required  for  a  judgment 
as  to  anapplicant's  ability  and  ambitions  in 


industry!  Tested,  standardized,  and  classified  facts  can  be 
used  as  the  basis  of  conclusions  by  anyone  without  the  exercise 
of  so  uncertain  a  factor  as  intuition.  It  is  not  so  many  years 
since  judgments  of  materials  and  methods  in  industry  were 
largely  intuitive.  No  one  would  wish  to  abandon  the  present 
system  of  chemical  and  physical  tests  for  these  old  methods. 

Requisites  for  Successful  Interviewing 

The  interviewer  should  not  fish  for  facts.  He  should  have 
before  him  an  analysis  of  the  place  to  be  filled  which  should 
describe  all  its  characteristics!  He  should  know  all  the  details 
ofthe  environment  to  which  the  prospective  worker  must 
be  adjusted.  He  should  know  its  physical,  mental,  and  social 
requirements,  as  well  as  its  trade  qualifications.  Here  we  are 
touching  upon  the  key  to  the  difficulty  of  character  analysis. 
Character  is  a  matter  of  relation  to  environment  and  depends 
as  much  upon  the  personal  and  physical  surroundings  as  upon 
the  innate  characteristics  of  the  individual.  If  some  of  the 
energy  that  has  been  devoted  IfoJ  hunting  for  the  elements 
of_characteriri  the  man  were  oevoted  to  analyzing_the  char- 
acter-producing elements  of  the  job.  J:he  solution  of  the  prob- 
lem might  be  nearer  at  hand.11 


11  "An  unusual  opportunity  of  observing  the  relativity  of  moral  qualities 
in  a  general  way  was  afforded  by  a  training  course,  consisting  of  about 
fifteen  college  men  who  were  being  shifted  from  one  shop  and  depart- 
ment to  another  in  a  systematic  attempt  to  acquaint  them  with  the 
fundamental  aspects  of  the  industry.  These  men  were  naturally  suffi- 
ciently interested  in  their  work  to  maintain  the  required  moral  level. 
Nevertheless,  their  interests  and  moral  traits  varied  noticeably  as  they 
were  shifted  from  one  shop  or  office  to  another.  .  .  .  Not  only  their 
enthusiasm  but  their  daily  attendance,  their  attentiveness,  and  the  quality 
of  their  work  were  governed  in  a  marked  degree  by  these  changing  factors. 
Whereas  one  kind  of  work  elicited  the  most  desirable  moral  traits  in  one 
man,  it  had  quite  the  opposite  effect  on  another.  At  the  end  of  the 


APPLICATION  BLANK;  INTERVIEWING  71 

The  interview  should  have  promotion  as  well  as  immediate 
placement  in  viewj  The  ambitions  ot  an  applicant  are  almost 
asirmjortant  as  his  abilities.  Jbecause  they  measure  in  gnm<> 
degree  his  future  possibilities.  Moreover,  their  gratification 

affords  almost  the  Only__Wfly  tr>  sprnre  thf  fnlljp^fprrj^rtf  his 

abilities.  When  convinced  that  there  is  a  place  for  the  appli- 
cant, the  interviewer  should  make  it  his  duty  to  "sell"  the  job 
so  that  it  will  stay_sojd.  This  necessitates  agreement  as  to 
wages,  and  an  explanation  of  conditions  connected  with  IHe 
work,  especially  a  description  of  disagreeable  features,  if  any, 
oftfiejphJ^.  The  new  employee  will  find  enough  unexpected 
difficulties  and  will  be  much  more  easily  satisfied  if  he  is  agree- 
ably disappointed  by  finding  some  things  ^better  than  he 
expected.  ^-o-sAA"  *-\y»sv^*jX  (/tf  ~ 


The  questions  to  be  asked  should  be  standardized.  There 
are  right  and  wrong  questions  to  ask,  and  a  right  and  wrong 
way  to  ask  them.  When  a  question  has  been  found  that 
produces  desirable  information,  it  should  be  written  out  and 
examined  to  see  if  it  is  in  the  best  possible  form.  This  means 
a  saving  of  time  and  greater  accuracy  and  uniformity  in 
results.  Ultimately,  by  the  use  of  scientific  methods,  the  inter- 
viewer's questions  should  become  a  set  of  accurate  oral  trade 
tests.13 

^nterviewjnj^jiLthisjcharactec  j^Jb,f^r  .  trainLng.__No  effi- 
ciently operated  hgusejwQiiId-send^ut-aa-untrained  salesman, 
The  work  of  the  employment  department  has  a  more  lasting 
influence  upon  the  firm  than  the  work  of  the  salesman,  and 
calls  even  more  for  training.  Proper  interviewing  implies 
perfect  familiarity  with  the  job  analysis,  with  all  the  condi- 


course  all  the  men  found  permanent  positions  of  widely  differing  kinds, 
and,  in  most  cases,  their  work  was  such  as  to  elicit  the  best  qualities  in 
them." — H.  C.  Link,  Employment  Psychology,  IQIQ,  pp.  204,  205. 

11  S.  H.  Slichter,  Turnover  of  Factory  Labor,  1919,  p.  311. 

"See  pp.  94-102. 


72  PERSONNEL  RELATIONS   IN  INDUSTRY 

tions  in  the  plant,  the  preparation  of  standard  questions,  and 
knowledge  of  the  proper  value  to  be  ffiven  to  replies.14 

Necessity  of  Physical  Examination 

AjDhysical  examination  is  frequently  used  ir»  hiring-.^ 
Compensation  laws  have  compelled  this  in  many  states. 
Wherever  such  an  examination  leads  to  a  large  number  of 
rejections,  it  meets  with  strong  objection  from  the  employees. 
This  is  a  part  of  that  reaction  which  labor,  or  any  other 
group,  shows  when  it  feels  that  discrimination  is  weakening 
the  group  solidarity.  This  same  group  solidarity,  based  on 
the  instinct  of  gregariousness,  is  one  of  the  most  valuable 
industrial  assets.  Whatever  attacks  it  reduces  production. 
Moreover,  the  wider  group  solidarity  of  society  demands  that 
all  productive  power  be  used,  and  that  no  person  capable  of 
production  without  injury  to  himself  should  be  barred  from 
industry.  That  there  is  danger  of  such  unsocial  rejection 
is  seen  from  the  following  extract  from  the  report  of  the 
Illinois  Health  Insurance  Commission,  May  i,  1919,  concern- 
ing the  results  in  eight  "possibly  typical  firms": 

The  industrial  physicians  connected  with  these  eight 
establishments  in  1917  examined  69,171  male  applicants  for 
work.  They  found  22,866  or  33.1  per  cent  of  these  diseased 
or  defective,  and  rejected  13,119  or  57.4  per  cent  of  them 
as  unfit  for  employment.  The  rejected  constituted  19  per 
cent  of  those  examined.  Among  the  22,866  were  1,406  with 
hernias,  205  with  tuberculosis,  342  with  kidney  trouble,  1,184 
with  high  blood  pressure,  1,663  wi*h  defective  vision,  564 
with  bad  teeth,  and  19  with  contagious  diseases.  In  using 
these  statistics  it  should  be  remembered  that  they  have  been 
obtained  from  the  examination  of  men  not  too  ill  or  too 
defective  to  apply  for  work. 


"The  Personnel  System  of  the  United  States  Army,  Vol.  I,  p.  119. 


APPLICATION  BLANK;  INTERVIEWING 


73 


ersonnel  WOrk  is  less 


w1'tVi  rpjWtinn  than 


rectification^  and  proper  adjustment  A  physical  examination 
should^e^  the  first  step  of  a  general  physical  program  of 
industrial  health  care.  Tf  jt  ig  ^Q  rpmgrnV^  the  objections 
of  the  employees  will  disappear. 

Advantages  of  Physical  Examination 

A^  physical  examination  protects  employees  against  com- 
municable disease  and  inP1irpg  parly  Hpffrtion  ap^  treatment 


of  deferts_jmd_ailrnfntei  thnr,  nntrnntoHj.  .might  become  serious, 
Such  an  examination  makes  possible  the  adaptation  of  work 
to  the  worker,  excludes  those  with  tubercular  tendencies  from 
dusty,  poorly  ventilalfd  j^bs,  ar>^  similarly  ^gs^^es  snrh  perr 


It  affords  an  opportunity 
forjiygienic  instruction  to  groups  and  individuals  and  supplies 
a  record^^f  physical  conditions.,  Itmakes  possible  the  pre- 
vention of  occupational  diseases  and  brings~to~trie~a:LLeiiLiun 
of  tfieJinTijjisg^nTahlp  nnd  iinsanftnr}^  ronditions,  snrh  as  nrp, 
oTteri  responsible  for  a  large  Jurnover,  and  -lhe__phyjical 
deterioration  of  employees.15 

The  physical  examination  should  include  tests  of  strength, 
sight,  hearing,  reaction^time.  _  fatigue,  and  other  features 
related  to 


rapacity  anrl  adjustment  The  tests  for 
aU_these  points  have  been  standardized,  they  can  be  given 
with  little  additional  trouble,  and  they  form  a  valuable  founda- 
tion for  later  work.  All  this  requires  that  the  physician  who 
makes  the  physira1_pygininati»"  shnnlH  rn-npprafp  in  tV  mgk- 
mg  of  the  job  analysis^  and  shrvnIH  HP  thoroughly  familiar 
witH~thlT  j-equirements  of  each  position.  His  contact  with 
employees  should  enable  him  constantly  to  add  to  the^nforrria- 
tion  descriptive  of  each  job,  and  thus  insure  a  continuous 


"  R.  A.  Feiss,  Personal  Relationship  as  a  Basis  of  Scientific  Manage- 
ment, Annals  of  the  American  Academy,  No.  154,  pp.  37-41. 


74  PERSONNEL   RELATIONS    IN   INDUSTRY 

improvementj)f  working  conditions  and  a  better  adjustment 
of  the  personnel. 

Throughout   all   Stages   nf   this   preliminary   wrtfk   H   V"!?* 
hf    rrmgtafltly    rpppatpH    tha±-jJ^-^m4rng   prinriplp    ik    ili^t    frU- 

action  is  to  secure  permanent  adjustment  _aspart_of  a  well- 
baTanced  working:  force 


CHAPTER  VI 

MENTAL   AND    TRADE    TESTS 

Testing  Ability  by  Trial  and  Error 

Ability  to  produce  is  what  is  sought  in  selecting  and  ad  just- 


ing ^(^iujTTaji_j.s_jv£lLasJi!^^ 

Hitherto  methodsof  discovering  and  grading  ability  have 
been  diverse  and  uncertain]  At  bottom  they  have  rested  upon 
the^nethod  of  trial  anH  err<yr  Even  when  most  effectively 
standardized,  neither  the  application  blank,  reference,  nor  the 
ordinary  interview,  gives  a  definite  classifiable  standard  of 
ability.  All  these  methods  leave  ability  to  be  tested  by  actual 
work  in  the  plant  —  the  most  expensive  and  unsatisfactory 
way. 

The  method  of  trial  and  error  has  gradually  been  aban- 
doned in  one  department  of  life  after  another,  until  the 
remaining  foothold  is  almost  solely  in  the  field  of  manage- 
ment. Today  it  is  derogatory  to^T  mechanic's  skill'  to  say 
he  is  a  "cut-and-try"  man.  Yet  management  and  personnel 
work  still  depend  upon  this  old  plan  of  natural  selection, 
trying  all  possible  adjustments  and  experiments  and  seldom 
even  keeping  an  accurate  record  of  failures  and  successes  so 
as  to  avoid  repeating  errors.  I  have  several  times  tested  the 
extent  of  the  success  of  this  method  in  industry  by  taking 
two  city  directories  issued  some  twenty  years  apart  and  check- 
ing the  number  of  firms  that  remained  in  business  for  the 
period,  which  is  less  than  a  single  lifetime.  It  is  not  cus- 
tomary for  a  successful  business  to  cease  operation  within 
twenty  years,  yet  seldom  more  than  10  per  cent  of  those 
examined  remained  continuously  in  existence  for  that  period. 

75 


76  PERSONNEL   RELATIONS   IN   INDUSTRY 

The  inference  is  that  the  managers  of  the  remaining  90  per 
cent  guessed  wrong  at  some  critical  point. 

Need  for  Accurate  Tests 

Mistakes  in  adjusting  men  and  women  to  their  tasks  result 
in  an  immeasurable  waste  of  human  life  and  productive  power, 
in  discontent,  suffering,  and  ruined  lives.  Any  system  thaf 
would  furnish  sufficiently  accurate  tests  of  ability  to  make 
it  possible  to  foretell  the  outcome  of  any  adjustment  of  men 
and  jobs  would  be  of  almost  incalculable  value.  The  absence 
of  such  tests  is  proof  of  the  unscientific  character  of  human 
adjustments  in  industry;  for,  as  Herbert  Spencer  has  said, 
"Prediction  is  the  business  of  science." 

The_use  of  a  reliable  test  of  ability  would  save  time  in 
hiding  and  almost  measureless  energy  in  subsequent  work._ 
Like  all  scientific  achievements,  it  would  save  the  exceptional 
person  for  exceptional  work  by  enabling  the  ordinary  person 
to  use  standardized  methods.  Only  a  scientific  test  can  be 
just,  fair,  and  impersonal,  jind  can  give  recordable,  classifiable 
facts  available  anywhere  for  anyone  who  wishes  to  use  them. 

The  search  for  reliable  tests  of  ability  is  not  a  new  one. 
Elaborate  experiments  in  this  direction  have  been  made  in 
the  civil  service.  Whatever  may  be  the  defects  of  the  various 
systems  of  civil  service  examinations,  they  at  least  give,  when 
properly  conducted,  an  impartial  standard  of  placement  and 
promotion.  The  comparative  freedom  of  such  a  system  from 
prejudice  and  favoritism,  with  its  promise  of  permanence  in 
position  and  promotion  by  its  impartial  judgment  of  effort, 
is  one  of  the  principal  reasons  for  the  attractiveness  of  civil 
service  and  its  extremely  low  turnover. 

Psychological  Measurement  of  Ability 

Ordinary  civil  service  examinations  are  too  cumbersome 
for  use  in  industry;  they  lack  flexibility.  They  usually  lay 


MENTAL  AND  TRADE   TESTS  77 

too   much    emphasis    on   memory    and    literary   knowledge. 

~W*"^\ 

Because  they  measure  information  and  not  intelligence,  they 
afford^Tttlelmowledge  of  the  possibility  of  growth.  Recogni- 
tion  of  these  defects  has  long  given  rise  to  a  desire  to  find 
some  method  of  getting  at  the  content  and  capacity  of  the 
mind,  and  of  actually  grading  native  ability.  This  is  essen- 
tially a  problem  for  the  psychologists.  Personnel  science  must 
take_the  results  gathered  by  psychologists  and  adapt  them  to 
the  industrial  field.  In  doing  this  it  adds  its  own  methods 
and  newly  discovered  facts,  and  thereby  richly  repays 
psychology  for  whatever  it  may  borrow. 

The  Old  Psychology 

Unfortunately,  however,  when  industry  first  turned  to 
psychology  for  help  it  found  the  latter  in  a  process  of  rapid 
change.  Only  within  comparatively  recent  years  were  the 
methods  or  the  material  of  psychology  of  value  in  solving 
the  problems  of  employment.  The  older  psychology's  methods 
of  testing  the  mind  were  almost  as  uncertain  and  unsatisfac- 
tory as  the  old  guessing  methods  in  industry.  Until  the  latter 
part  of  the  nineteenth  century  most  psychologists  worked 
upon  what  is  known  as  the  "faculty"  theory  of  mental  activity. 
William  James  describes  this  theory  as  follows:  1 

The  most  natural  and  consequently  the  earliest  way  of 
unifying  the  material  was,  first,  to  classify  it  as  well  as  might 
be,  and,  secondly,  to  affiliate  the  diverse  mental  modes  thus 
found  upon  a  simple  entity,  the  personal  Soul,  of  which  they 
are  taken  to  be  so  many  faculative  manifestations.  Now, 
for  instance,  the  Soul  manifests  its  faculty  of  Memory,  now 
of  Reasoning,  now  of  Volition,  or  again  its  Imagination  or 
its  Appetite. 

While  this  theory  dominated,  or  that  of  the  allied  associa- 
1  William  James,  Psychology,  1902,  Vol.  i.  p.  I. 


78  PERSONNEL   RELATIONS   IN   INDUSTRY 

tionist  school  which  did  little  more  than  eliminate  the  soul 
and  depend  upon  association  to  hold  these  faculties  together, 
there  was  little  that  psychology  could  contribute  to  practical 
life.  It  only  catalogued  the  faculties  and  tried  to  find  out 
something  about  their  operation  by  introspection.  Titchener, 
one  of  the  founders  of  the  new  school  of  psychology,  criticizes 
the  old  attitude  in  the  following  manner:  2 

So  long  as  mind  was  looked  upon  as  a  substance,  a  real 
being,  a  personal  creature,  psychology  had  no  more  to  do 
than  to  note  down  the  different  powers  or  faculties  or 
capacities  of  the  mind,  as  they  fell  under  observation.  The 
list  always  remained  open.  Not  until  mind  is  regarded  as 
a  stream  of  processes,  whose  flow  is  throughout  obedient 
to  psychological  law,  does  the  problem  of  analysis  become 
insistent.  Besides,  this  problem  can  be  solved  only  by  help 
of  the  experimental  method;  and  the  first  laboratory  of 
psychology  was  founded  as  late  as  1879. 

It  might  be  thought  that  personnel  work  is  little  interested 
in  dead  and  buried  theories  of  psychology.  But  unfortunately 
personnel  workers  have  been  robbing  the  grave  of  those 
theories  and  using  them.  The  whole  idea  of  character  analysis 
and  judgment  by  asking  the  applicant  what  he  thinks  he  is 
and  knows,  is  based  upon  just  this  antiquated  theory.  We 
shall  find  this  generally  to  be  true,  that  so-called  common 
sense  is  composed  of  intellectual  strata  filled  with  the  fos- 
silized theories  of  dead  sciences.3 


2E.  B.  Titchener,  Text-Book  of  Psychology,  1910,  p.  47. 

1  "A  statement  that  rests  upon  common  sense  is  not  likely  to  be  argued ; 
it  is  taken  for  granted,  as  something  that  needs  no  discussion.  Yet,  in 
theoretical  matters,  common  sense  is  an  unsafe  guide.  For  the  common 
sense  of  our  own  generation  simply  sums  up  so  much  of  the  advanced 
thought  of  former  generations  as  the  great  body  of  mankind  has  found 
acceptable  and  intelligible.  A  brilliant  speculation  of  one  age  may  become 
the  common  sense  of  the  next;  but  this  does  not  make  it  any  the  less 
speculation,  while  in  the  course  of  becoming  common  sense  its  logical 
structure  has,  inevitably,  been  more  or  less  damaged.  Common  sense  in 
theoretical  matters,  is  past  philosophy;  and  the  philosophy  is  the  more 


MENTAL  AND  TRADE  TESTS  79 

The  New  Psychology 

While  the  new  psychology  does  not  entirely  discard  intro- 
spection and  intuition  as  a  means  of  studying  the  mind,  it 
lays  very  much  more  stress  upon  objective  tests  of  mental 
states.  This  is  the  method  of  all  other  sciences!  The  chemist 
does  not  ask  oxygen  how  it  wishes  to  act,  nor  does  the  physi- 
cist depend  upon  the  introspection  of  the  falling  body  to 
enlighten  him  as  to  the  laws  of  gravitation.  While  the  study 
of  the  mind  has  the  advantage  that  the  mind's  owner  can 
tell  something  of  its  operations,  it  also  has  the  great  dis- 
advantage that  the  owner  is  not  an  impartial  judge.  There- 
fore the  results  of  introspection  at  least  need  checking  by  the 
same^sort  of  objective  ohgprvarinn  used  in  examining  other 
objects. 

The  new  scientific  school  looks  upon  the  mind  as  a  func- 
tion of  the  brain  and  nervous  system,  in  much  the  same  way 
that  contraction  is  a  function  of  muscles  and  digestion  a  func- 
tion of  the  stomach.  The  nervous  system  is  always  perform- 
ing this  function  and  thought  is  therefore  continuous,  but  has 
expressions,  forms,  processes,  or  elements. 

Experimental  psychology  has  developed  many  ways  of 
investigating  the  mind  and  the  nervous  system.  It  lays  much 
stress  upon  an  accurate  and  minute  knowledge  of  the  brain 
and  nerves  and  all  their  activities — upon  physiological 
psychology.  It  has  devised  intricate  and  delicate  instruments 
with  which  to  measure  the  speed  of  nerve  impulses,  the 
strength  and  keenness  of  sensations,  the  reaction  time  of 
nerves,  the  fatigue  of  muscles,  and  similar  phenomena.  Much 
of  this  work  is  of  value  in  testing  human  capacities  for 
industrial  adjustment.  The  new  psychology  has  devoted  much 
time  to  the  analysis  of  human  instincts  and  their  expression 


vulgarized  the  farther  it  has  traveled  from  its  course." — E.  B.  Titchener, 
Text-Book  of  Psychology,  1910,  p.  47. 


80  PERSONNEL  RELATIONS   IN  INDUSTRY 

in  h^man  hefavinr  In  so  doing  it  has  laid  a  deep  and  solid 
foundation  for  all  social  relations.  Further  light  upon  this 
field  promises  to  be  shed  by  the  careful  studies  of  the  sub- 
conscious mind — of  dreams,  hypnosis,  forgetfulness,  aver- 
sions, etc.  In  these  states,  the  mind  is  caught  off  its  guard 
and  reveals  much  that  introspection  and  report  would  rather 
conceal.4 

Evolution  of  Mental  Tests 

The  most  immediately  available  results  for  industry  were 
obtained  from  the  study  of  animal,  child,  abnormal,  injured, 
and  defective  mentalities,  the  method  being  to  try  to  analyze 
the  respective  strength  or  capacities  of  certain  mental  func- 
tions. The  study  of  animal  psychology  revealed  the  existence 
of  certain  deep-lying  mental  elements  the  origin  of  which 
antedates  the  origin  of  man  himself.  Such  elements  will  be 
slow  to  change  and  powerful  in  their  influence.  The  fact 
that  some  elements  of  normal  mentality  are  lacking  in 
abnormal  and  subnormal  minds  makes  possible  the  isolation 
and  study  of  such  elements.  The  effect  of  blows  or  other 
injuries,  or  certain  drugs,  creates  a  similar  opportunity  to  test 
the  effect  of  the  absence  of  certain  mental  functions. 

The  Binet-Simon  Tests 

The  study  of  subnormal  children  revealed  the  material 
and  methods  of  greatest  value  in  testing  industrial  ability. 
In  1904,  Binet  and  Simon,  two  French  psychologists,  were 
appointed  upon  a  commission  charged  with  the  education  of 
the  feeble-minded  children  of  Paris.  Until  then  there  had 
been  no  method  of  grading  such  children  according  "to  their 


*  When  Freudian  psycho-analysis  shall  have  cast  off  some  of  its  rather 
freakish  features  it  will  undoubtedly  leave  behind  it  a  methodology  that 
will  be  fundamental  in  analyzing  human  motives,  desires,  instincts,  and 
the  behavior  founded  upon  them. 


MENTAL  AND  TRADE  TESTS  8l 

mentality  and  therefore  no  means  of  adjusting  treatment  to 
their  needs.  These  two  scientists  sought  to  develop  a  series 
of  tests  that  would  make  such  grading  and  treatment  possible. 
They  set  for  themselves  a  standard  for  such  tests,  which 
contained  apparently  impossible  conditions.5 

A  series  of  tests  should  be  found  for  each  year  of  child- 
hood, the  passing  of  which  could  be  considered  normal  and 
typical  for  children  of  just  precisely  this  age.  The  tests 
must  be  relatively  uninfluenced  by  external  and  chance  con- 
ditions, especially  by  school  learning,  so  that  the  result 
might  bring  out  as  purely  as  possible  the  real  mental  endow- 
ment of  the  child;  they  must  admit  of  as  uniform  use  as  pos- 
sible in  different  nations,  languages,  and  grades  of  culture; 
they  should  be  easy  to  carry  out,  not  necessitate  laboratory 
apparatus  or  instruments  of  precision,  should  not  exact  too 
much  time  of  the  child,  should  not  impose  hardship  on  him 
or  tire  him,  and  yet  must  possess  sufficient  accuracy  to  make 
possible  comparison  and  checking  of  the  investigations 
undertaken  by  different  persons;  and,  finally,  they  should 
make  it  possible  to  work  out  a  final  value  for  each  subject 
tested  that  could  be  deemed  a  measure  of  his  general 
intelligence. 

It  will  at  once  be  evident  that  here  is  a  problem  compar- 
able to  that  which  Taylor  and  Earth  attempted  in  the  field 
of  cutting  metals.  There  is  at  least  an  equal  number  of 
variables,  and  the  human  material  is  more  difficult  of 
standardization  than  metals.  The  high  degree  of  success 
attained  by  these  two  French  scientists  in  approaching  this 
standard  places  them  among  the  few  who  have  made  great 
advances  in  human  knowledge.  It  will  also  be  noticed  that 
the  standards  set  parallel  at  many  points  those  which  the 
personnel  manager  is  trying  to  meet.  The  methods  used  are 


*L.  W.  Stern,  Psychological  Methods  of  Testing  Intelligence,  1914,  pp. 
29,  30. 


82  PERSONNEL   RELATIONS   IN   INDUSTRY 

full  of  suggestions  as  to  those  to  be  followed  in  establishing 
standard  industrial  tests. 

Tests  Established  for  Normal  Children 

The  experiments  began  by  testing  normal  school  children. 
Whenever  the  children  of  a  certain  age  passed  a  test  and 
the  next  younger  ones  failed,  it  was  accepted  as  a  standard 
of  attainment  for  the  older  age.  Diversified  tests  sought  to 
measure  various  phases  of  intelligence,  so  as  to  obtain  a 
general  standard  of  ability  at  each  grade. 

The  tests  are  of  continuously  increasing  difficulty.  They 
begin  with  those  which  are  designed  to  discover  the  very 
beginnings  of  intelligence  in  the  youngest  infants  and  the 
lowest  grades  of  imbeciles,  and  which  are  shared  by  the  lower 
animals.6 

The  first  of  the  original  tests  consisted  in  passing  a  lighted 
match  before  the  eyes  to  ascertain  whether  attention  could 
be  aroused  so  that  the  eyes  would  follow  the  light.  This 
was  followed  by  placing  an  object  in  the  hand  to  test  prehen- 
sion. The  subject  was  then  given  a  block  of  wood  and  a 
block  of  chocolate  to  ascertain  whether  he  was  capable  of 
distinguishing  between  food  and  not  food.  The  tests  then 
gradually  grew  more  difficult  through  the  naming  of  objects, 
the  comparison  of  unequal  lines  and  weights,  judgments  as 
to  conduct,  comparison  of  words,  memory  of  sentences,  and 
finally  the  original  set  of  thirty  closed  with  one  asking  the 
definition  of  certain  abstract  terms. 

Methods  of  Applying  Tests 

The  tests  were  given  in  succession  beginning  with  the 
simplest,  unless  this  was  evidently  not  required,  until  the 


*Alf.  Binet  and  Th.  Simon,  The  Development  of  Intelligence  in  Chil- 
dren, 1916,  pp.  45-69,  for  description  of  original  tests  and  methods  of 
use;  G.  M.  Whipple,  Manual  of  Mental  and  Physical  Tests,  1914,  Vols.  I 
and  II,  for  the  later  developments. 


MENTAL  AND   TRADE   TESTS  83 

subject  failed  upon  one.  In  the  later  revised  methods  adopted 
by  the  original  founders,  the  number  of  tests  were  increased 
until  there  were  approximately  five  for  each  year.  Then  the 
following  instructions  were  given : 7 

Take  for  point  of  departure,  the  age  at  which  all  tests 
are  passed;  and  beyond  this  age,  count  as  many  fifths  of  a 
year  as  there  are  tests  passed.  Example :  a  child  of  eight 
years  passes  all  the  tests  of  six  years,  2  of  seven  years, 
3  of  eight  years,  2  of  nine  years,  one  of  ten  years;  he  has 
therefore  the  level  of  six  years  plus  the  benefit  of  eight 
tests,  or  eight-fifths  years,  or  a  year  and  three-fifths,  or 
more  simply,  7.6.  .  .  .  But  it  must  be  well  understood  that 
this  fraction  is  so  delicate  an  appreciation,  that  it  does  not 
merit  absolute  confidence,  because  it  varies  appreciably  from 
one  examination  to  another. 

When  the  tests  were  completed,  it  was  found  that  a  method 
had  been  evolved  for  the  grading  of  intelligence  which  pro- 
duces uniform  results  everywhere,  and  which  has  since  been 
utilized  in  every  civilized  country  and  applied  to  many  savage 
tribes  as  well.  Since  the  publication  of  the  first  tests  by  Binet 
and  Simon  they  have  been  constantly  altered  and  improved, 
but  the  method  remains  little  changed  and  most  of  the  subse- 
quent tests  are  based  upon  those  of  the  original  workers. 

Grading  Rather  Than  Measurement 

It  should  be  understood  that  tests  are  not  so  much  meas- 


ures  of  intelligence  as  standards  by  which  to  grade  in 

with  reference  to  certain  intellectual  qualities.     The  original 


'Alf.  Binet  and  Th.  Simon,  The  Development  of  Intelligence  in 
Children,  1916,  p.  278  et  seq. 

Although  the  grades  are  expressed  in  terms  of  years  it  should  be 
always  remembered  that  they  only  mark  differences  of  degree  and  that  a 
person  assigned  a  "mental  age  of  three  years,"  for  example,  does  not  have 
the  same  mental  equipment  as  a  normal  child  of  that  age.  An  adult 
moron  is  not  the  mental  equivalent  of  a  normal  infant. 


*  PERSONNEL   RELATIONS   IN   INDUSTRY 

discoverers    were    careful    to    make    this    clear    when    they 
said: 8 

This  scale  properly  speaking  does  not  permit  the  meas- 
ure of  the  intelligence,  because  intellectual  qualities  are  not 
superposable,  and  therefore  cannot  be  measured  as  linear 
surfaces  are  measured,  but  are  on  the  contrary,  a  classifi- 
cation, a  hierarchy  among  diverse  intelligences;  and  for  the 
necessities  of  practice  this  classification  is  equivalent  to  a 
measure.  We  shall  therefore  be  able  to  know,  after  study- 
ing two  individuals,  if  one  rises  above  the  other  and  to 
how  many  degrees,  if  one  rises  above  the  average  level 
of  other  individuals  considered  as  normal,  or  if  he  remains 
below.  Understanding  the  normal  progress  of  intellectual 
development  among  normals,  we  shall  be  able  to  determine 
how  many  years  such  an  individual  is  advanced  or  retarded. 

The  measurement  of  intelligence  by  tests  has  often  been 
compared  to  the  measurement  of  temperature  by  a  thermom- 
eter. The  position  of  zero  and  the  length  of  the  degrees 
are  fixed  arbitrarily  in  each  of  the  various  systems  of  measur- 
ing temperature,  but  no  matter  how  much  thermometers  differ 
as  to  these  features  they  will  agree  as  to  which  of  two  tem- 
peratures is  the  warmest  The  comparison  would  hold  good 
in  detail  were  it  not  for  the  fact  that  mental  measurements 
are  not  of  a  single  quality  or  element.  They  do  not  measure 
simply  in  one  dimension,  as  has  been  pointed  out  by  some 
workers  in  this  field,  but  rather  in  three,  or  even  more  dimen- 
sions, simultaneously,  and  the  different  dimensions  are  not 
always  comparable.  For  practical  purposes  of  personnel 
work,  however,  these  distinctions  need  not  trouble  us. 

Definition  of  Intelligence 

The  tests  aim  to  discover  and  grade  what  is  commonly 
known  as  general  intelligence,  orthat  peculiar  combination 


*A1£.  Binet  and  Th.  Simon,  The  Development  of  Intelligence  in  Chil- 
dren, 1916,  p.  40. 


MENTAL  AND   TRADE   TESTS  85 

of  abilities  that  makes  the  human  mind  of  more  value  in 
gaining  control  of  its  environment  than  is  the  mind  of  the 
lower__animal,  and  that  gives  to  the  minds  of  certain  in- 
dividuals greater  power  over  their  surroundings  than_is  pos- 
sessed by  others.  Many  psychologists  have  tried  to  define  this 
quality,  and  they  are  now  reaching  an  agreement.  As  industry 
seeks  the  same  quality,  it  is  well  to  know  how  psychologists 
define  it.  Jacques  Loeb  says  of  the  characteristic  of  brain 
superiority  in  man:  9 

All  experiments  point  to  the  fact  that  this  overwhelm- 
ing abundance  of  associations  which  even  a  disabled  human 
brain  can  form  is  lacking  in  animals.  One  impression  may 
arouse  only  a  very  limited  number  of  associations.  .  .  .  This 
small  capacity  for  associations  makes  the  reactions  of  ani- 
mals appear  machine-like  and  less  intelligent.  I  think  that 
the  greater  capacity  of  the  human  brain  for  associations 
and  the  greater  celerity  with  which  these  associations  are 
formed  and  retained  are  sufficient  to  explain  why  mankind 
has  been  able  to  control  nature,  while  animals  remain  at  its 
mercjr, 

William  Stern  defines  intelligence  as  "a  general  capacity 

of_ar^  individnpl    ronsrirmsly   to    adjust   his    thinking   tr>   new_ 

requirements;  it  is  general  mental  adaptability  tn  npw  prob- 
lems and  conditions,  oUiie^0 

Binet  and   Simon   describe  the   characteristic  they  were 
seeking  in  these  words:  " 

It  seems  to  us  that  in  intelligence  there  is  a  fundamental 
faculty,  the  alteration  or  the  lack  of  which  is  of  the  utmost 
importance  for  practical  life.  This  faculty  is  judgment, 
otherwise  called  good  sense,  practical  sense,  initiative,  the 


"Jacques  Loeb,  Comparative  Physiology  of  the  Brain,  1900,  p.  286. 
10  L.  W.  Stern,  Psychological  Methods  of  Testing  Intelligence,  1914,  p.  3. 
"Alf.  Binet  and  Th.  Simon,  The  Development  of  Intelligence  in  Chil- 
dren, 1916,  pp.  42,  43. 


86  PERSONNEL   RELATIONS   IN   INDUSTRY 

faculty  of  adapting  oneself  to  circumstances.  To  judge 
well,  to  comprehend  well,  to  reason  well,  these  are  the  essen- 
tial activities  of  intelligence.  A  person  may  be  a  moron  or 
an  imbecile  if  he  is  lacking  in  judgment;  but  with  good 
judgment  he  can  never  be  either.  Indeed  the  rest  of  the 
intellectual  faculties  seem  of  little  importance  in  compari- 
son with  judgment.  .  .  .  The  same  remark  holds  good  for 
the  study  of  memory.  At  first  glance,  memory  being  a 
psychological  phenomenon  of  capital  importance,  one  would 
be  tempted  to  give  it  a  very  conspicuous  part  in  an  exami- 
nation of  intelligence.  But  memory  is  distinct  from  and 
independent  of  judgment.  One  may  have  good  sense  and 
lack  memory.  The  reverse  is  also  common. 

William  James  says : 12  "The  pursuance  of  future  ends  and 
the  choice  of  means  for  their  attainment  are  thus  the  mark 
and  criterion  of  the  presence  of  mentality  in  a  phenomenon." 

Industrial  and  Educational  Methods  Compared 

Industry  is  concerned  with  the  transformation  of  materials 
into  forms  suitable  to  satisfy  human  wants.  _It  is  the  basic 
means  by  which  man  conquers  and  adjusts  himself  to  his 
environment.  It  is  therefore  evident  that  the  characteristics 
for  which  the  psychologists  are  searching  are  those  which  it 
would  be  of  value  to  industrial  management  to  recognize. 
Yet  the  methods  of  testing  for  industry,  while  based  upon 
those  for  general  intelligence,  are  very  different.  ^Industry 
may  still  use  various  methods  of  experimental  psychology  to 
determine  the  accuracy  and  acuteness  of  the  senses,  reaction 
time,^  fatigue  rate,  and  so  forth.  __  There  is  also  a  place  in 
industrial  work  for  tests  of  memory  and  acquired  knowledge, 
and  especially  of  peculiar  mental  abilities  and  habits  not  given 
great  weight  in  general  intelligence  tests.18 


"William  James,  Psychology,  1902,  Vol.  I,  p.  8. 

UH.  C.  Link,  Employment  Psychology,  1919,  Chap.  XII,  on  place  of 
"general  intelligence"  in  employment  work. 


MENTAL  AND   TRADE   TESTS  87 

Extension  of  Use  to  Higher  Educational  Work 

The  Binet-Simon  tests  were  first  published  in  1909  and 
were  translated  into  English  the  next  year.14  They  were 
instantly  welcomed  by  scientists  everywhere.  Within  a  few 
years  it  is  doubtful  if  there  was  a  single  civilized  country  in 
which  the  education  of  subnormal  children  was  not  being 
directed  according  to  grades  established  by  these  tests.  The 
value  of  the  scale  and  tests  in  grading  normal  children  was 
quickly  recognized.  Schools  and  universities  began  to  use 
the  tests  in  grading  pupils  and  in  adjusting  their  work. 

The  step  from  subnormal  to  normal  children  in  the  field 
of  education  was  natural  and  inevitable.  Educators  had  long 
sought  for  some  more  satisfactory  method  of  ascertaining 
ability  and  measuring  progress  than  was  afforded  by  examina- 
tions and  personal  observation.  In  the  beginning,  much  of 
the  work  with  normal  children  and  adults  was  for  the  purpose 
of  testing  the  tests  and  improving  the  methods  of  using  them. 
But  it  soon  became  evident  that  the  information  they  furnished 
threw  a  flood  of  light  upon  some  hitherto  dark  corners  in 
methods  of  teaching.15 

Especially  in  the  field  of  technical  training  and  engineering 

education,    where   Other    farii1fj_pg_tb?Jl,.lllOSf   nf   mpmnry   an^ 

literary~e5cpressionL  are  of  high  value,  do  such  tests  seem  to^ 
promise  most.     "The  invention  and  perfection  by  experiment 


14Alf.  Binet  and  Th.  Simon,  The  Development  of  Intelligence  in  Chil- 
dren, 1916,  p.  5. 

'  "The  University  of  Minnesota  High  School  has  for  three  years  given 
mental  tests  designed  to  measure  general  intelligence,  to  all  entering 
students.  Students  are  assigned  to  sections  on  the  basis  of  these  examina- 
tions. This  classification  makes  possible:  (i)  the  application  of  class- 
room technique  suited  to  each  section;  (2)  a  rate  of  progress  consistent 
with  the  ability  of  each  section;  (3)  a  better  quality  and  a  greater 
quantity  of  work  in  the  abler  sections ;  (4)  a.  reduction  in  the  number  of 
failures;  (5)  a  keener  interest  in  each  section — the  slower  students 
experience  less  discouragement  and  the  faster  students,  because  of  keener 
competition,  are  less  likely  to  contract  habits  of  idleness  and  carelessness." 
— W.  S.  Miller,  School  Review,  Feb.  1920,  p.  94. 


88  PERSONNEL   RELATIONS    IN   INDUSTRY 

of  objective  tests  of  ability  seems  to  offer  the  most  promising 
road  to  progress  toward  a  type  of  instruction  that  places  less 
emphasis  on  information  and  more  on  ability  to  use  informa- 
tion intelligently."  16 

The  United  States  Army  Tests 

Further  investigation  and  experimentation  with  the  tests 
resulted  in  the  extension  of  their  field  to  normal  adults.  Such 
a  scale  was  applied  to  millions  of  soldiers  in  the  United  States 
army  during  the  Great  War.  Out  of  the  results  of  that 
investigation  and  the  trade  tests  that  accompanied  it  was 
gained  the  greatest  contribution  to  the  preparation  and  use 
of  tests  in  industry. 

The  tabulation  of  the  results  of  the  application  of  intelli- 
gence tests  to  millions  of  men  gives  a  literal  cross-section  of 
the  intellectual  ability  of  the  nation.  This  cross-section  shows 
the  following  distribution  of  the  abilities  which  the  tests  were 
able  to  measure:  17 

A.  Very  Superior  Intelligence.    This  grade  is  earned  by 
only  four  or  five  soldiers  out  of  a  hundred.    The  "A"  group 
is  composed  of  men  of  marked  intellectuality.     Such  men 
are  of  high  officer  type  when  they  are  also  endowed  with 
leadership  and  other  necessary  qualities. 

B.  Superior  Intelligence.   "B"  intelligence  is  superior,  but 
less  exceptional  than  that  represented  by  "A."     The  rating 
"B"  is  obtained  by  eight  to  ten  soldiers  out  of  a  hundred. 
The  group  contains  a  good  many  men  of  the  commissioned 
officer  type  and  a  large  amount  of  non-commissioned  officer 
material. 

C+.  High   Average   Intelligence.     This   group    includes 
about  fifteen  to  eighteen  per  cent  of  all  soldiers  and  con- 


"C.  R.  Mann,  A  Study  of  Engineering  Education,  Carnegie  Founda- 
tion for  the  Advancement  of  Teaching,  1918,  pp.  57,  70  et  passim. 

"The  Personnel  System  of  the  United  States  Army,  1919,  Vol.  I,  pp. 
132,  133- 


MENTAL  AND  TRADE  TESTS  89 

tains  a  large  amount  of  non-commissioned  officer  material, 
with  occasionally  a  man  whose  leadership  and  power  to 
command  fit  him  for  commissioned  rank. 

C.  Average  Intelligence.    Includes  about  twenty-five  per 
cent   of    soldiers.      Excellent   private   type    with    a   certain 
amount  of  fair  non-commissioned  officer  material. 

C — .  Low  Average  Intelligence.  Includes  about  twenty 
per  cent.  While  below  average  in  intelligence,  "C — "  men 
are  usually  good  privates  and  satisfactory  in  work  of  routine 
nature. 

D.  Inferior  Intelligence.     Includes  about  fifteen  per  cent 
of  soldiers.    "D"  men  are  likely  to  be  fair  soldiers,  but  are 
usually  slow  in  learning  and  rarely  go  above  the  rank  of 
private.     They  are  short  on  initiative  and  so  require  more 
than  the  usual  amount  of  supervision.     Many  of  them  are 
illiterate  or  foreign. 

D — and  E.  Very  Inferior  Intelligence.  This  group  is 
divided  into  two  classes  (i)  "D — "  men,  who  are  very  in- 
ferior in  intelligence  but  are  considered  fit  for  regular  ser- 
vice; and  (2)  "E"  men,  those  whose  mental  inferiority  jus- 
tifies their  recommendation  for  Development  Battalion, 
special  service  organization,  rejection,  or  discharge. 

The  immense  contrast  between  "A"  and  "D — "  intelli- 
gence is  shown  by  the  fact  that  men  of  "A"  intelligence  have 
the  ability  to  make  a  superior  record  in  college  or  univer- 
sity, while  "D — "  men  are  of  such  inferior  mentality  that 
they  are  rarely  able  to  go  beyond  the  third  or  fourth  grade 
of  the  elementary  school,  however  long  they  attend.  In 
fact,  most  "D— "  and  "E"  men  are  below  the  "mental  age" 
of  10  years  and  at  best  are  on  the  border-line  of  mental 
deficiency.  "B"  intelligence  is  capable  of  making  an  average 
record  in  college,  "C  +  "  intelligence  cannot  do  so  well,  while 
mentality  of  the  "C"  grade  is  rarely  equal  to  high  school 
graduation. 

The  original  Binet-Simon  tests  were  determined  by  the 
fact  that  those  for  a  given  age  were  passed  by  50  per  cent 
of  the  normal  children  at  that  age,  with  25  per  cent  above 
and  25  per  cent  below.  The  accuracy  of  this  method  of 


90  PERSONNEL   RELATIONS   IN   INDUSTRY 

selection  was  proved  when  the  distribution  of  intelligence 
in  adults,  tested  by  closely  analogous  methods,  showed  prac- 
tically an  identical  distribution.  If  these  results  are  plotted 
they  will  give  the  well-known  Gaussian  curve,  so  familiar  in  all 
fields  of  science,  where  the  median  line  contains  the  greater 
number  and  the  deviations  shade  off  in  symmetrical  form  from 
each  side.18 

'Application  of  Tests  to  Industry 

Many  suggestions  for  the  application  of  intelligence  tests 
in  industry  may  be  drawn  from  the  army  work. 

The  principal  use  to  which  this  information  was  put  was 
to  see  to  it  that  each  company  or  battery  had  its  pro  rata 
share  of  intelligence ;  in  other  words  that  each  had  its  share 
of  superior  men  intellectually,  of  average  men,  and  of  infe- 
rior men.  The  information  was  also  utilized  as  an  aid  in 
determining  how  good  a  man  was  at  his  trade.  For  ex- 
ample, a  carpenter  of  two  years'  experience,  earning  $30.00 
a  week  before  the  war  and  of  "B"  intelligence  would  be 
rated  a  journeyman,  whereas  a  carpenter  of  five  years'  ex- 
perience, earning  $18.00  a  week  and  of  "D"  intelligence 
would  be  rated  an  apprentice.  The  "B"  man  would  un- 
doubtedly learn  in  2  years  what  the  "D"  man  could  not 
learn  in  five  years,  hence  it  would  be  fair  to  rate  them  in 
terms  of  their  earnings  instead  of  their  years  of  experience. 

This  idea  of  balancing  the  intelligence19  in  units  is  new 
to  industrial  management.  Yet  it  is  one  that  may  have  much 
to  dowith  determining  efficiency..  It  is  possible  that  units  so 
balanced  would  show  a  greater  solidarity,  willingness  to  co- 
operate, and  a  smoother  operation  at  many  points.  It  gives 


UL.  W.  Stern,  Psychological  Methods  of  Testing  Intelligence,  1914, 
PP.  43,  44- 

"The  Personnel  System  of  the  United  States  Army,  1919,  Vol.  I,  pp. 
133,  134- 


MENTAL   AND   TRADE   TESTS  91 

a  general  basis  for  more  appropriate  adjustment,  the  great 
problem  in  personnel  relations.20 

The  graded  difficulty  of  learning  revealedby  the  intelli- 
gence tests  is  of  great  value  in  determining  systems  of  promo- 
tiorPand  training^  It  is  one  more  aid  to  predicting  future 
development,  and  such  aids  are  among  the  most  precious 
assets  of  science.  It  would  be  almost  impossible  to  over- 
value the  ability  to  predict  the  success  or  failure  of  workmen 
in  various  lines  of  promotion.  These  tests  do  not  yet  make 
such  prediction  possible,  except  within  narrow  lines  and  with 
many  reservations.  Yet  they  go  further  in  that  direction 
than  anything  previously  known  and  they  probably  point  the 
way  to  still  greater  gains  in  the  same  direction.21 


""Suppose  care  was  taken  to  keep  the  various  operative  units  of  an 
industry  well  balanced  in  the  sense  that  each  operative  unit  consists  of 
individuals  of  proper  intelligence  for  the  job.  This  means  shifting  the 
mentally  slow  from  positions  involving  great  judgment,  adaptability  and 
mental  resourcefulness :  it  means  also  removing  the  mentally  alert  from 
work  of  a  dull  routine  nature,  unvarying,  tedious,  calling  in  no  way  for 
the  full  exercise  of  the  capacities  of  an  intelligent  workman.  It  is  con- 
ceivable that  such  balancing  would  not  only  be  profitable  from  the  point 
of  view  of  immediate  production,  but  that  a  major  cause  of  industrial 
unrest  and  discontent  would  be  attacked." — Beardsley  Ruml,  Selective 
Tests  in  Industry,  Annals  of  the  American  Academy,  Jan.  1919. 

1  "Those  children  that  ranked  'at  age'  in  the  first  testing  had  advanced 
next  year  exactly  one  year,  on  the  average,  while  the  retarded  children 
had  advanced  only  two-thirds  of  a  year,  and  the  advanced  children  one 
year  and  a  quarter  in  the  same  period." — L.  W.  Stern,  Psychological 
Methods  of  Testing  Intelligence,  1914,  p.  69,  discussing  results  of  tests  of 
children  by  Binet-Simon  method. 

"The  measurement  of  ability  to  learn  may  properly  be  divided  into : 
(i)  The  measurement  of  pre-requisites,  ground  work,  or  necessary 
foundations  upon  which  to  build ;  (2)  the  measurement  of  accomplishment 
in  itself  not  essential  but  which  has  been  attained  as  a  result  of  an 
activity  which  correlates  highly  with  the  activity  necessary  in  learning  the 
task  in  hand,  e.g.,  if  there  is  a  high  degree  of  correlation  between  the 
ease  with  which  an  American  can  learn  Chinese,  a  measurement  of  time 
spent  in  learning  French  and  facility  acquired  would  give  evidence  as  to 
the  probable  success  in  learning  Chinese;  (3)  the  measurement  of  ability 
to  learn  the  new  tasks  by  tests  which  are  as  nearly  as  possible  samples 
of  operations  demanded  in  the  task  itself;  and  (4)  the  measurement  of 
interest." — T.  L.  Kelly,  Principles  Underlying  the  Classification  of  Men, 
Journal  of  Applied  Psychology,  Mar.  1919,  p.  65. 


92  PERSONNEL  RELATIONS   IN   INDUSTRY 

Measurement  of  Concentration 

A  suggestion  growing  out  of  the  idea  of  balancing  indus- 
trial units  according  to  intelligence,  though  it  should  not  be 
used  without  further  investigation  may  yet  prove  helpful  to 
all  concerned.  Many  employment  managers  report  that  there 
is  a  certain  type  of  mind  that  actually  welcomes  monotonous 
work.  It  may  be  possible  that  many  of  those  who  are 
graded  below  normal  in  intelligence  not  only  find  no  discom- 
fort in  monotonous  work,  but  on  the  contrary  find  the  effort 
demanded  by  original  work  painful.22  An  experiment  by 
Ebbinghaus,  a  German  investigator,  suggests  a  possible 
explanation.23  He  made  many  experiments  to  ascertain  the 
ability  to  memorize  nonsense  syllables,  meaningless  but  pro- 
nounceable combinations  of  letters.  Such  syllables  are  sup- 
posed to  measure  the  span  of  attention,  or  the  limit  of  the 
power  of  the  mjpd  tn  hr>H  ™atprn1  w^t^^nt  tha  ^Hp  of  assorjfl- 
£i<2n.  The  normal  mind  holds  about  five  or  six  such  syllables, 
but  this  capacity  usually  declines  rapidly  with  lessening  intel- 
ligence as  measured  by  tests.  Some  have  suggested  that  this 
test  measures  the  faculty  of  rhythm  in  the  human  mind  and 
have  thought  they  found  an  explanation  of  certain  facts  in 
music  and  prosody  in  the  results  the  test  revealed.  May  it 
not  be  possible  that  where  this  span  of  attention  is  unable  to 


""Mr.  James  F.  Hartness  in  his  little  book  The  Human  Factor  in 
Industry1  has  pointed  out  that  there  is  a  type  of  mind  which  is  very 
prevalent  in  industry  that  wants  nothing  but  the  steady  job.  The  man 
with  that  type  of  mind  wants  nothing  but  the  one  thing  to  do.  If  he  has 
nothing  else  to  do  but  that  one  thing,  and  can  hold  that  job  for  his 
normal  lifetime,  he  is  far  happier  than  if  he  were  given  a  job  which 
requires  thought,  initiative  and  responsibility  on  his  part.  I  know  that 
is  the  case  because  I  have  individually  had  experience  along  that  line. 
In  my  little  force  I  have  two  girls  of  just  that  type  of  mind.  They  are 
good,  steady,  industrious  workers,  and  I  tried  to  promote  them  to  jobs 
requiring  a  little  more  initiative  and  a  little  more  responsibility.  They 
would  not  have  it.  They  were  perfectly  satisfied  to  go  ahead  and  make 
their  $10  or  $11  a  week  with  their  hands,  rather  than  get  $15  a  week  and 
use  a  little  more  initiative." — R.  T.  Kent,  Bulletin  of  Taylor  Society,  Dec. 
1917,  p.  13- 

n  Psychology,  Encyclopedia  Brittanica. 


MENTAL  AND   TRADE   TESTS  93 

grasp  more  than  two  or  three  disconnected  syllables,  each 
motion  on  an  automatic  machine  is  essentially  a  new  experi- 
ence and  therefore  rouses  no  sense  of  monotony  ? 2* 

Such  as  yet  untested  suggestions  should,  of  course,  not 
be  accepted  as  a  blanket  excuse  for  retaining  men  and  women 
in  monotonous  work.  There  have  been  many  instances  of 
persons  of  apparently  dull  intellect,  who  through  the  posses- 
sion of  an  indomitable  will  have  made  great  achievements. 
Any  use  of  intellectual  gradations  based  upon  tests,  as  an 
excuse  for  establishing  any  sort  of  status  in  society  or  indus- 
try, would  be  dangerous.  But  there  is  a  fruitful  field  for 
investigation  here  that  may  assist  greatly  in  such  an  adjust- 
ment of  personnel  elements  in  industry  as  will  afford  greater 
pleasure,  increased  production,  and  much  less  pain  and  waste. 

Measurement  of  Trade  Ability 

A  more  direct  hint  of  value  to  industry  is  the  fact  revealed 
by  the  army  tests  that  there  is  a  hierarchy  of  ability  in  trades. 
The  intelligence  tests  showed  that  men  who  were  trained 
engineers  ranked  highest  in  the  tests — higher  even  than  those 
from  the  so-called  professions — and  that  there  was  a  steady 
gradation  down  to  those  who  had  learned  no  trade.  This  at 
least  arouses  a  strong  suspicion  that  we  are  here  on  the  track 


"*  "There  are  many  automatic  machines  which  require  an  operator  with 
only  the  most  elementary  kind  of  intelligence  and  attention;  and  there  is 
a  large  amount  of  manual  work  which  involves  only  the  learning  of  a  few 
simple  movements  which  are  continuously  repeated  in  exactly  the  same 
way  and  which,  when  once  acquired,  can  be  performed  without  the  aid  of 
attention.  For  such  work  mental  defectives  are  often  well  adapted.  In- 
deed, they  are  often  better  fitted  for  it  than  individuals  of  a  higher  in- 
telligence because,  having  very  few  ideas  and  very  little  mental  activity, 
they  are  unable  to  perceive  the  monotony  and  dulness  of  their  work.  They 
are  themselves  quite  automatic,  and  can  almost  wholly  lose  themselves  in 
the  work  which  they  are  doing.  What  better  solution  of  the  problem  of 
idiocy  and  undeveloped  mentality  can  there  be,  both  from  an  economic 
and  a  social  standpoint,  than  to  detect  such  applicants  and  assign  them  to 
work  for  which  they  are  peculiarly  adapted?" — H.  C.  Link,  Employment 
Psychology,  1919,  pp.  185,  186. 


94  PERSONNEL   RELATIONS   IN   INDUSTRY 

of  a  method  of  determining  trade  ability,  and  certainly  of  a 
method  of  determining  ability  to  succeed  in  a  trade.  Before 
tests  could  be  applied  generally,  economically,  and  with  reli- 
able results  in  industry,  many  more  experiments  and  much 
modification  were  necessary.25 

In  the  course  of  adapting  tests  to  the  deaf  and  the  blind 
a  technique  was  developed  by  which  the  tests  can  be  given 
without  language,  through  objects  and  pictures.  These 
methods  were  further  developed  in  testing  illiterates  in  the 
army,  and  are  now  ready  to  be  used  for  similar  classes  in 
industry. 

Requirements  of  Trade  Tests 

When  the  army  was  confronted  with  the  vital  problem 
of  selecting  hundreds  of  thousands  of  skilled  craftsmen,  and 
when  the  whole  success  of  the  war  and  the  conduct  of  opera- 
tions of  all  kinds  depended  upon  these  selections  being  made 
swiftly  and  accurately,  there  was  a  choice  between  two 
methods: 26 

One  view  was  that  trade  tests  should  be  made  up  of 
carefully  prepared  and  reasonably  checked  questions  and 
answers  for  each  trade  and  graded  into  three  groups,  for 
apprentices,  for  journeymen,  for  experts.  Moreover  such 


M  Those  who  wish  to  follow  more  in  detail  the  methods  by  which  tests 
were  developed  should  consult  the  following :  G.  M.  Whipple,  Manual  of 
Mental  and  Physical  Tests,  1915;  R.  M.  Yerkes,  A  Point  Scale  for 
Measuring  Ability,  1915,  and  Army  Mental  Tests,  1919;  E.  L.  Thorndike, 
Theory  of  Mental  and  Social  Measurements,  1004;  L.  W.  Stern,  The 
Psychological  Methods  of  Testing  Intelligence,  1014;  Articles  in  Journal 
of  Educational  Psychology,  and  Journal  of  Applied  Psychology. 

A  further  bibliography  can  be  found  in  Bureau  of  Education  Library 
Leaflet,  No.  2,  on  Educational  Tests  and  Measurements,  and  in  Helen 
Boardman's  Psychological  Tests,  A  Bibliography,  published  by  the  Bureau 
of  Educational  Experiments,  1917. 

26  Personnel  System  of  the  United  States  Army,  1919,  Vol.  I,  p.  357. 
The  chapter  of  which  this  is  a  part  describes  the  whole  process  of  making 
the  trade  tests.  The  methods  used  are  essentially  those  which  must  be  used 
in  industry. 


MENTAL  AND   TRADE   TESTS  95 

questions  should  be  asked  by  experts  or  at  least  tradesmen 
in  the  trade,  who  would  be  able  to  gather  from  the  answers 
given  in  the  test  how  skilled  the  applicant  was. 

The  above  method,  which  is  regularly  employed  in  indus- 
try, was  found  so  unsatisfactory  in  the  army  that  it  was 
discarded  in  favor  of  an  entirely  different  method.  Doubtless 
if  the  same  method  had  been  subjected  to  the  same  stern 
tests  in  industry  that  it  met  in  time  of  war  it  would  long  ago 
have  been  discarded  here  also. 

The  other  conception  of  trade  tests  emphasized  that  such 
sets  of  questions  and  answers  were  of  little,  or  possibly  of 
no  use,  until  they  had  actually  been  tried  out  and  it  was 
known  that  novices,  apprentices,  journeymen,  and  experts 
could  be  differentiated  through  their  use.  And  the  emphasis 
was  placed,  moreover,  upon  an  actual  try-out,  not  upon  the 
opinion  of  experts  as  to  how  good  the  questions  were.27 

The  method  that  science  employs  in  dealing  with  theories 
is  based  on  the  query:  Does  it  agree  with  the  facts?  and  not, 
Does  it  please  some  authority?  At  every  step  the  tests  are 
tested,  and  if  they  do  not  meet  the  standards  set  they  are 
abandoned. 

The  standard  set  for  the  tests  in  army  work  involved  three 
points:  "(i)  They  must  differentiate  between  the  various 
grades  of  trade  skill;  (2)  they  must  produce  uniform  results 


in  various  places  and  in  the  hands  of  different  examiners; 
and  (3)  they  must  consume,  in  the  giving,  a  small  amount 
of  time,  energy  and  material."  28 

Preparation  of  Army  Tests 

C4 
To  prepare  these  tests  an  intimate  job  analysis  was  made 

in  many  localities,  supplementing  the  one  already  made  and 

27  The  Personnel  System  of  the  United  States  Army,  1919,  Vol.  I,  p.  357. 
*/&«.,  p.  365- 


96  PERSONNEL   RELATIONS   IN   INDUSTRY 

described.29  From  all  the  information  that  could  be  gathered, 
a  list  of  some  60  to  90  questions  was  made.  These  were  then 
tested  on  a  group  composed  of  20  novices,  20  apprentices,  20 
journeymen,  and  20  experts.  Only  those  questions  were 
retained  which  showed  by  actual  tests  that  they  served,  not 
only  to  distinguish  between  those  who  had  worked  at  the 
trade  and  those  who  had  not,  but  also  to  classify  such  crafts- 
men according  to  their  skill.  Moreover,  the  questions  had 
to  be  so  worded  "as  to  bring  out  easily  scored  answers.  Many 
of  the  questions  .  .  .  resulted  in  long  and  involved  answers, 
and  often  in  a  great  variety  of  answers,  all  approximately 
correct.  Such  answers  could  not  be  scored  by  an  examiner 
who  was  not  an  expert  in  the  trade."  30  But  the  object  of 
the  tests  was  to  save  the  exceptional  man,  and  so  questions 
had  to  be  devised  that  could  be  correctly  answered  only  in  a 
very  few  words  and  in  not  more  than  two  or  three  ways. 
These  answers  could  then  be  printed  on  the  list  of  questions 
and  scored  by  anyone  capable  of  reading  and  writing. 

Classification  of  Trade  Skill 

A^+ 

Next,  if  the  tests  were  to  indicate  degrees  of  skill  it  was 

necessary  to  have  standard  classifications  of  skill.  As  usual 
in  the  field  of  personnel  relations  no  such  standards  existed, 
although  their  existence  had  been  implied  in  popular  language 
and  acted  upon  in  the  regular  hit-or-miss  style  of  so-called 
practical  business  men  for  years.  Certain  crude  standard 
definitions  were  made  for  these  grades  by  the  government, 
and  these  standards  will  undoubtedly  greatly  improve  in  the 
future,  as  standards  when  once  set  have  a  way  of  doing. 

The  apprentice  was  said  to  be  a  tradesman  who,  while 
master  of  certain   aspects  of  his  trade,  could  not  yet  be 


See  p.  23. 
1  The  Personnel  System  of  the  United  States  Army,  1919,  Vol.  I,  p.  364. 


MENTAL  AND  TRADE  TESTS  97 

entrusted  with  an  important  task.  The  journeyman  was  a 
tradesman  who  could  perform  practically  any  job  in  his 
trade.  The  expert  could  perform  quickly  and  with  superior 
skill  any  work  done  by  men  in  his  trade.31 

Before  mobilization  ceased  trade  tests  had  been  perfected 
for  83  of  the  more  essential  trades.  This  work  of  making 
the  tests,  like  all  original  scientific  work,  is  slow  and  expen- 
sive. It  was  necessary  to  establish  a  school  to  train  the  makers 
of  tests.  Yet  when  the  work  was  finished  the  cost  had 
amounted  to  only  about  $1,000  per  trade,  and  the  "resulting 
economies  of  pay  and  subsistence  of  otherwise  misplaced 
soldiers  was  several  times  that  amount  every  month ;  and  the 
still  more  valuable  economy,  not  measurable  in  dollars,  is 
found  in  the  resulting  facilitation  of  training,  through  correct 
initial  placement." 

On  the  results  so  attained,  P.  N.  Golden,  of  the  Trade 
Test  Division  of  the  War  Department  says: 32 

One  of  the  things  the  Committee  [on  classification  of 
personnel  in  the  army]  did  was  to  shoot  the  bug-a-boo  of 
"the  only  way  to  find  out  is  to  let  the  man  show  what  he 
can  do"  so  full  of  holes  it  can  be  considered  practically 
dead.  There  are  a  few  occupations  to  which  the  above 
rule  applies,  but  their  number  is  so  small  that  they  can  be 
considered  almost  negligible.  Another  secret  of  the  Com- 
mittee's success  lay  in  that  they  refused  to  believe  that 
"what  a  man  knows  is  no  indication  of  his  ability  to  hold  a 
job"  and  they  proved  their  idea  was  correct  in  innumerable 
cases  and  under  many  trying  conditions. 


The  main  reason  the  oral  tests  gave  such  satisfactory 
results  was  because  the  questions  asked  were  such  that  the 
tradesman  actually  knew  the  answer,  not  what  he  should 


11  The  Personnel  System  of  the  United  States  Army,  1919,  Vol.  I,  pp. 
365,  366. 

"P.  N.  Golden,  American  Machinist,  Aug.  1919,  Vol.  LI,  pp.  409-411. 


98  PERSONNEL  RELATIONS   IN  INDUSTRY 

theoretically  know.  The  answers  printed  in  the  tests  were 
correct  answers  which  the  tradesmen  themselves  actually 
gave,  not  answers  given  in  handbooks,  school  books  or  by 
some  technically  trained  manager  or  engineer.  The  ques- 
tions, moreover,  were  so  carefully  worded  that  their  mean- 
ing was  perfectly  clear  and  the  answers  printed  in  the  tests 
were,  so  far  as  it  was  humanly  possible  to  discover,  the 
only  correct  answers  which  could  be  given  by  tradesmen. 
The  result  was  that  men  could  be  rated  by  these  tests  by 
anybody  who  could  read  and  put  down  the  scores  made  in 
conformity  with  a  set  of  very  simple  rules. 


A  properly  devised  oral  test  can  be  administered  by  any 
man  or  woman  of  ordinary  intelligence  in  an  employment 
office  in  less  than  ten  minutes,  and  the  applicant  will,  in  at 
least  90  per  cent  of  the  cases  show,  on  being  put  on  the  job, 
the  degree  of  ability  indicated  by  the  result  of  his  oral  trade 
test. 

Performance  Tests 

The  army  also  made  use  of  numerous  forms  of  perform- 
ance tests,  which  consisted  largely  of  miniature  or  condensed 
operations  of  the  kind  demanded  in  the  trade.  In  some  cases 
it  was  possible  to  use  actual  operations  such  as  would  be 
required  in  the  trade,  and  to  have  the  work  performed  under 
close  observation  according  to  laboratory  methods.38  It  was 
found,  however,  that  the  results  of  such  tests  correlated  so 
closely  with  those  of  the  oral  tests  as  to  be  practically  a 
duplication,  adding  little  new  information.  It  may  be  accepted 

as  a  dern  on  st  rated  fart  thaj-  oral  trade  tests  have  hepn  tp^tp^ 
to  the  point  where  their  value  is  beyond  dispute.  The  testing 
tcT  whichthey  have  been  subjected  is  definite.  The  results 
do  not  depend  upon  unrecorded  opinions;  they  can  be 


"Personnel  System  of  the  United  States  Army,  1919,  Vol.  II,  Chap. 
VI,  pp.  123-165,  gives  detailed  description  of  both  performance  and  trade 
tests  and  methods  of  giving,  with  samples  of  both  forms  of  tests. 


MENTAL  AND   TRADE   TESTS 


99 


expressed  in  exact  percentages.     The  tests  are  demonstrated 
time-savers  in  the  process  of  hiring  and  give  a  sound  basis 


foT~mrmitely  greater  savings  in  the 


ment,  training,  transfers,  and  promotion  that  goes  on  in  every 


Development  of  Industrial  Trade  Tests 

As  industry  after  industry  makes  use  of  tests  the  standards 
will  be  continually  improved,  and  great' improvements  may  be 
expected  in  the  near  future.  .Many  firms  are  already  making 
practical,  continuous  experiments.  I  recently  had  an  oppor- 
tunity to  examine  the  process  by  which  two  large  industries 
having  plants  in  different  parts  of  the  country  developed  tests 
for  use  in  adjusting  employees.  Their  methods  were  those 
which  must  precede  the  formation  and  use  o,f  tests  if  the 
results  are  to  be  satisfactory.  The  first  step  was  a  thorough 
standardization  of  all  positions.  It  was  found,  as  might  be 
expected,  that  although  these  companies  had  long  led  in  up-to- 
date  methods,  there  was  no  agreement  as  to  names  and  duties 
of  various  occupations.  Men  doing  exactly  the  same  work 
in  different  plants  were  paid  different  wages  and  their  trades 
were  known  by  different  names,  ^careful  and  elaborate 
job  analysis  was  conducted,  in  the  course  of  which  foremen 
and  others  were  asked  to  suggest  test  questions.  These 


M  "Standardized  trade  tests  have  been  producing  uniform  ratings  of 
ability  for  the  army,  ratings  that  were  equivalent  in  all  parts  of  the 
United  States.  If,  through  the  use  of  tests,  such  uniformity  of  evaluation 
can  be  gained  from  place  to  place,  so  also  can  it  be  gained  from  month  to 
month.  .  .  .  Such  standards  can  be  used  in  specifying  definitely  the 
degree  of  skill  required  in  various  positions,  and  in  assuring  that 
employees  who  are  taken  on  from  time  to  time  measure  up  to  this  fixed 
standard.  An  unchanging  scale  in  terms  of  which  degrees  of  ability  can 
be  stated  would  also  make  possible  the  determination  of  the  sum  total 
ability  in  the  working  force  of  an  industry.  Such  an  evaluation  of  avail- 
able skill  would  reduce  one  of  the  intangible  assets  of  business  to  a 
tangible  one,  with  consequent  increase  in  the  significance  of  all  thinking 
involving  this  phase  of  industrial  fact." — Beardsley  Ruml,  Selective  Tests 
and  Industry,  Annals  of  the  American  Academy,  Jan.  1919,  p.  45. 


100  PERSONNEL   RELATIONS    IN   INDUSTRY 

tions  were  then  assembled  and  tested  on  employees  of  known 
skill.  The  result  was  a  set  of  trade  questions  that  are  now 
saving  thousands  of  dollars  monthly  and  will  go  on  saving 
at  an  increasing  rate  for  years  to  come.  It  should  be  em- 
phasized that  the  success  of  trade  tests  depends  primarily 
upon  the  care  with  which  the  original  work  of  preparation 
is__dojne,  and  that  the  most  expert  supervision  and  great- 
est care  are  none  too  good  to  be  used  in  establishing  the 
original  standards  by  which  all  subsequent  work  will  be 
measured. 

National  Standard  Intelligence  Tests 

Already  there  is  a  beginning  of  a  series  of  national 
standard-tests.  The  Teachers'  College  of  Columbia  Univer- 
sity supplies  sets  of  intelligence  tests  particularly  suited  for 
work.  Though  trade  organizations  are  preparing 


to  undertake  such  work  for  all  their  members,  for  some  time 
to  come  the  final  work  must  be  done  in  each  plant. 

A  most  fruitful  suggestion  as  to  the  establishment  of 
national  standards  has  been  made  by  J.  J.  Swan,  who  pre- 
pared the  trade  specifications  for  the  United  States  Bureau 
of  Labor,  to  be  used  in  all  war  work.  He  says:  35 

I  would  like  to  propose  that  in  time,  and  as  soon  as 
the  United  States  Employment  Service's  personnel  can  be 
trained  up  sufficiently,  it  will  be  possible  to  introduce  very 
generally  standardized  forms  of  "trade  tests"  and  "ratings" 
for  men,  and  that  the  service  can  then  issue  a  rating  card 
to  each  man  tested,  which  can  be  presented  to  an  employer 
and  will  serve  as  an  identification  and  an  assurance  that 
the  holder  thereof  has  passed  a  standard  examination  and 
test  entitling  him  to  a  definite  rating  in  a  specific  trade.  A 
man's  rating  can  be  advanced  at  any  time,  provided  the  man 
applies  to  the  nearest  station  and  successfully  passes  the 

*  J.  J.  Swan,  Army  Trade  Tests,  Circular  No.  4,  United  States  Bureau 
of  Education,  April  1919,  pp.  23,  24. 


MENTAL  AND   TRADE   TESTS  IOI 

tests  for  the  advanced  rating.  In  this  way  each  man  is  en- 
couraged to  improve  and  no  hardship  is  worked  on  anyone. 
This  system  would  be  universal  in  its  application  and 
would  act  to  help  both  the  employee  and  employer  by  obvi- 
ating a  trial  period  or  misplacement  in  the  assignment.  It 
would  give  a  standing  to  the  bearer  of  such  a  card,  and 
an  assurance  to  an  employer  that  the  man  has  demonstrated 
his  ability  to  be  classed  under  the  trade  and  rating  stated 
on  his  card.  Being  universal  and  an  actual  identification, 
there  would  be  no  necessity  to  make  a  man  wait  until  his 
record  was  investigated,  or  to  take  him  on  at  a  lower  rating 
and  try  him  out.  All  this  presupposes  the  employment  ser- 
vice being  brought  up  to  a  high  standard,  and  a  willing  and 
close  cooperation  between  the  various  trade-unions,  work- 
ers and  employers  in  each  community  and  generally.  Already 
certain  unions  have  or  are  organizing  trade  tests  to  classify 
members.  Some  manufacturers  have  similar  plans  due  to 
a  feeling  that  they  must  determine  the  ability  of  the  men 
they  employ  in  their  own  way. 

Here  we  have  a  glimpse  of  the  possibility  of  placing  the 
whole  matter  of  the  relations  of  all  personnel  elements  in 
industry  upon  a  truly  scientific  basis,  with  wide  possibilities 
for  increased  production,  more  harmonious  relations,  and 
greater  happiness  to  all  concerned. 

Future  Developments 

It  must  not  be  supposed  that  the  use  of  tests  in  industry 
has  been  so  perfected  in  all  its  phases  as  to  leave  nothing 
to  be  done  except  to  apply  them  indiscriminately.  There  are 
some  fields  in  which  no  tests  have  yet  been  found_satisfactory. 
This  is  true  in  the  work  of  choosing  higher  executives, 
although  considerable  work  of  an  experimental  character  has 
been  done  in  this  field.  Butjio  one  has  yet  made  any  accurate^ 
job  analysis  of  such  positions  to  determine  what  qualifications 
are  needed.  The  whole  work  of  management  has  been  so 
unstandardized,  so  imperfect  in  its  results,  so  uncertain  in 


LIBRARY 

UNIVERSITY  Or 


102  PERSONNEL   RELATIONS   IN   INDUSTRY 

its  methods,  and  so  permeated  with  the  spirit  of  trial  and 
error  that  little  can  be  accomplished  in  this  direction  until  the 
business  of  management  becomes  more  scientific.36 

The  technique  of  preparing  and  making  the  tests  is  now 
going  through  a  period  of  rapid  evolution,  not  only  directly 
in  industry,  but  through  researches  being  made  by  hundreds 
of  psychologists  in  every  industrial  nation.  These  scientists 
are  taking  the  material  that  was  gathered  in  testing  millions 
in  the  various  armies  and  hundreds  of  thousands  in  industry, 
and  subjecting  it  to  careful  analysis.  Out  of  this  study  is 
coming  new  knowledge  of  the  human  mind,  new  and  better 
methods  of  making  and  applying  tests,  and  more  accurate 
systems  of  testing  the  results. 

There  is  every  reason  to  believe  that  in  this  field  lies  the 
greatest  probability  of  rapid  progress  during  the  next  few 
years;  and  that  the  industry  or  the  nation  that  first  makes 
use  of  this  knowledge  will  find  its  productive  capacity  so 
greatly  increased,  and  its  calculations  rendered  so  much  more 
accurate,  as  to  give  it  an  important  advantage  in  a  competitive 
world. 


1 H.  C.  Link,  Employment  Psychology,  1919,  pp.  190,  191. 


CHAPTER  VII 

INTRODUCING   THE   NEW   EMPLOYEE 

Group  Instinct 

The  group  instinct  is  far  older  than  man.  It  built  all 
the  endless  forms  of  animal  association — the  pack,  flock, 
covey,  and  herd.  This  gregariousness  is  the  foundation  of 
all  human  society.  For  many  thousands  of  years  it  found 
expression  in  the  tribe  and  clan,  then  in  city,  nation,  church, 
club,  school,  party,  and  any  other  group  into  which  human 
beings  naturally  gather.  Always  such  groups  turn  against  the 
outsider.  The  pack  hunts  together,  and  the  stranger  is  the 
enemy.  For  many  centuries  this  was  a  condition  of  survival. 
Only  those  in  whom  the  instinct  was  so  deeply  implanted 
as  to  command  instant  and  unconscious  response  survived  to 
hand  on  a  strengthened  instinct  to  their  descendants. 

Such  a  group,  as  soon  as  it  becomes  fixed,  develops  some 
sort  of  initiation  ceremonies  to  mark  the  introduction  of  the 
outsider  to  a  place  in  the  inner  circle.  In  savage  tribes,  where 
the  group  instinct  must  be  preserved  as  a  condition  of  survival, 
such  ceremonies  are  apt  to  be  elaborate  and  to  constitute  the 
most  important  educational  and  religious  customs  of  the  tribe. 
Even  the  children  of  the  tribe  are  not  accepted  until  after 
such  initiation.1  Remnants  of  this  practice  remain  in  natural- 
ization, in  first  communion,  and  in  all  the  formulas  of  initia- 
tion into  secret  societies. 

When  all   formality  of   initiation  has   disappeared,   the 


*W.  I.  Thomas,  Source  Book  for  Social  Origins,  1909,  pp.  216-267; 
G.  S.  Hall,  Adolescence,  1907,  Vol.  II,  Chap.  XIII. 

103 


104  PERSONNEL  RELATIONS   IN   INDUSTRY 

instinct  still  insists  upon  expression  in  the  hazing  that  always 
greets  the  entering  member  of  a  new  group.  Even  such  a  com- 
mon custom  as  the  introduction  by  a  mutual  friend,  together 
with  the  subsequent  handshaking  and  mutual  good  wishes,  is 
a  vestige  of  the  old  tribal  initiation  of  the  stranger  into  a  new 
group. 

Significance  of  the  Group  Instinct 

Modern  industry  as  a  comparatively  new  form  of  group 
should  make  use  of  this  instinct  of  gregariousness,  which  is 
one  of  the  foundations  of  that  esprit  de  corps  so  much  valued 
and  so  seldom  found.  In  its  relation  to  the  newcomer,  how- 
ever, the  instinct  has  its  drawbacks.  He  brings  with  him 
a  suspicion  of  the  new  and  untried,  reinforced  by  that  instinct 
of  secretiveness  which  has  always  been  a  defense  of  the 
individual  against  possible  hostility.2 

The  newcomer  into  an  industry  meets  the  instinct  of  gre- 
gariousness and  unconscious  hostility  just  at  the  moment 
when  all  his  other  difficulties  are  the  greatest.  The  first  few 
weeks  are  a  time  of  learning  new  duties,  adjustment  to  new 
relations,  understanding  of  new  customs.  There  is  an  old 
saying  based  on  this  racial  instinct,  "First  impressions  are 
most  lasting."  It  is  therefore  doubly  necessary  that  these  first 
impressions  should  not  leave  the  new  employee  with  a  sense 
of  hostility,  suspicion,  and  discomfort.  A  bad  beginning  is 
a  costly  thing  to  remedy. 

The  Law  of  Learning 

An  unsigned  article  in  the  Scientific  American  of  January 
II,  1919,  sets  forth  the  situation  confronting  the  new  worker 
in  these  words : 


'William  James,  Psychology,  1902,  Vol.  II,  pp.  432-434- 


INTRODUCING   THE   NEW   EMPLOYEE  IO5 

Every  man  in  every  occupation  makes  mistakes  at  the 
start.  This  is  nothing  to  his  discredit,  provided  he  has 
profited  by  them  and  rearranges  his  mode  of  conduct  so 
as  to  prevent  the  same  mistake  twice. 

The  routine  of  new  work  necessitates  the  formation  of 
new  habits.  The  process  of  habit  formation  is  as  essen- 
tially physiological  as  any  other  function  of  our  material 
bodies.  It  has  its  basis  in  the  most  highly  organized  mechan- 
ism of  man — the  nervous  system.  .  .  . 

Nervous  tissue  is  very  plastic  and  readily  yields  to  re- 
peated stimulation.  But  from  the  time  we  start  to  form  a 
habit  until  it  is  absolutely  part  and  parcel  of  our  body,  there 
are  dangerous  pitfalls  for  the  individual.  The  most  critical 
time  is  when  we  must  judge  whether  or  not  we  can  trust  the 
lower  nerve  centers  to  carry  out  our  wish.  Too  much  new 
stimulus  forces  us  to  crowd  unripe  habits  into  the  subordi- 
nate centers  of  control.  What  happens?  They  function  in- 
efficiently, we  make  mistakes,  call  these  habits  back  to  con- 
sciousness, confusion  results  and  we  get  discouraged.  .  .  . 

If  an  employee  can  cross  this  plateau  of  uncertainty  in 
forming  new  habits,  the  battle  is  half  won.  If  an  employer 
can  understand  the  stress  and  strain  of  this  period  for  the 
employee,  he  will  often  develop  a  valuable  man  instead  of 
losing  his  temper  and  firing  him. 

The  beginning  period  is  one  of  instruction,  not  only  in 
new  methods  of  working,  but  in  countless  other  little  things 
that  irritate  and  disturb.  There  is  a  peculiar  law  of  learning 
partially  explained  in  the  above  quotation  that  gives  rise  to  a 
critical  period  shortly  after  the  learning  has  begun.  It  has 
been  discovered  that  in  learning  anything,  from  skating  to 
French,  from  typewriting  to  swimming,  the  process  usually 
moves  through  three  stages.  There  is  first  a  period  of  com- 
paratively rapid  improvement.  Then  comes  a  time  of  very 
slight  gain,  followed  by  another  period  of  improvement  which 
is  usually  somewhat  slower  than  the  first  and  continues  longer. 
The  second  stage,  known  to  educators  as  the  "plateau  of 
learning"  because,  when  the  process  is  plotted  it  appears  as 


106  PERSONNEL   RELATIONS   IN   INDUSTRY 

an  almost  level  plateau  between  two  upward  slopes,  is  always 
a  period  of  discouragement  In  industry  it  is  one  of  the 
periods  of  most  rapid  turnover  in  the  whole  employment 
relation.  Every  student  of  the  subject  of  turnover  agrees 
that  the  proportion  of  changes  is  highest  during  the  first  few 
months  after  hiring.3 

If  this  period  is  safely  passed,  if  the  new  employee  is 
initiated  into  the  group  and  the  new  adjustments  made,  then 
the  connection  will  not  be  broken  without  some  stronger  rea- 
son than  would  cause  a  separation  in  the  earlier  uncertain 
months. 

Effect  of  Incentives  on  Rate  of  Learning 

There  seems  to  be  a  growing  consensus  of  opinion  among 
educators  and  psychologists  (the  latter  basing  their  conclu- 
sions largely  upon  experiments  with  animals)  that  the  exist- 
ence of  the  plateau  of  learning  is  largely  due  to  lack  of  proper 
application  of  incentives.  If  the  incentive  is  changed  or  in- 
creased at  the  critical  points,  the  upward  progress  towards 
mastery  continues  in  a  fairly  regular  curve.  It  is  just  this 
control  over  incentives  that  furnishes  the  management  with 
the  power  to  make  the  breaking-in  period  one  of  steadily 
increasing  ability  and  interest* 


*S.  H.  Slichter,  Turnover  of  Factory  Labor,  1919,  pp.  44-57. 

"These  places — where  the  curve  remains  horizontal,  showing  neither 
gain  nor  loss — need  explanation.  It  is  probable  that  their  explanation  is 
to  be  found  in  the  failure  to  control  the  incentives.  No  such  plateaux  or 
resting  places  are  to  be  found  in  the  curves  illustrating  the  motor  acquisi- 
tions of  animals.  When  an  animal  has  to  work  or  remain  hungry:  to 
make  a  correct  response  at  an  alley  or  be  punished,  etc.,  the  incentive 
may  be  said  to  remain  at  a  maximum.  The  situation  is  clearly  different 
when  human  beings  are  forced  to  learn  to  typewrite.  The  act  is  a  very 
complex  one  and  the  stimuli  leading  to  action  are  not  compelling.  If  a 
man's  food  (reactions  to  sex  stimuli,  shelter,  etc.)  were  dependent  upon 
acquiring  skill  in  a  certain  line — conditions  which  we  can  now  control  in 
the  animal — such  resting  places  and  plateaux  would  in  all  probability 
disappear  from  his  learning  curves." — J.  B.  Watson,  Psychology  from 
the  Standpoint  of  a  Behaviorist,  1919,  p.  202. 


INTRODUCING  THE  NEW  EMPLOYEE  I<>7 

Discomfort  During  Adjustment  Period 

The  process  of  making  new  adjustments  is  in  many  ways 
positively  painful.  The  rearrangement  of  nervous  tissue  con- 
sequent upon  the  establishment  of  new  habits  and  new  rela- 
tions is  in  itself  a  cause  of  fatigue  and  discomfort.  The  fact 
that  the  new  employee  does  not  give  this  explanation  of  his 
discontent  and  is  wholly  unconscious  of  the  cause  only  shows 
how  deep  below  the  level  of  consciousness  these  instincts  lie 
buried.  He  acts  upon  them  so  regularly  and  so  frequently 
that  their  existence  is  proved.  Because  the  instinct  is  too  deep 
to  rise  into  consciousness  it  is  difficult  to  change. 

Facilitating  Adjustment 

Adjustment  to  the  new  conditions  is  greatly  facilitated 
by  proper  employment  methods.  If  interviewing  and  job 
analysis  have  been  well  done,  the  first  degree  of  the  initiation 
has  been  completed.  From  the  moment  the  decision  is  made 
to  hire  the  new  worker,  the  idea  of  permanence  must  be  main- 
tained. Such  an  attitude  should  underlie  every  change  during 
the  preliminary  period.  Every  step  should  be  taken  on  the 
supposition  that  the  new  employee  will  stay  and  grow  with 
the  industry.  Suggestion  is  a  powerful  force,  and  its  use 
at  this  time  and  in  this  manner  establishes  a  frame  of  mind 
that  will  be  helpful  in  all  subsequent  work. 

Matters  to  be  Explained 

Every  possibility  of  misunderstanding  as  to  the  character 
and  duties  of  the  job  should  now  be  cleared  away.  There 
should  be  an  exact  understanding  as  to  wages,  and  the  period, 
if  any,  over  which  only  a  preliminary  rate  will  be  paid.  The 
possibilities  of  promotion  should  be  explained.  The  firm  with- 
out a  systematic  promotion  policy  based  on  a  job  analysis 
is  here  at  a  disadvantage.  It  cannot  well  plan  out  a  line  of 
promotion  such  as  makes  for  permanence.  The  discussion 


108  PERSONNEL   RELATIONS   IN   INDUSTRY 

of  promotion  gives  an  opportunity  to  get  a  line  on  the  ambi- 
tions of  the  new  worker.  If  his  connection  with  the  firm 
can  be  planned  so  as  to  further  those  ambitions,  then  his 
permanent,  enthusiastic  support  is  assured.  The  employment 
department  should  assist  in  planning  the  educational  work 
necessary  to  attain  the  next  step  in  promotion.  If  the  new 
worker  begins  with  his  eye  on  a  better  position  within  the 
concern  and  a  plan  by  which  to  attain  it  already  in  his  mind, 
the  attractions  of  outside  positions  will  lose  much  of  their 
appeal.  We  are  all  profoundly  influenced  by  things  due  to 
happen  in  the  near  future.  Employees  in  the  civil  service 
endure  low  wages  and  many  other  disagreeable  features 
because  they  are  offered  opportunities  for  promotion  based 
on  definite  and  clearly  understood  improvements  in  ability, 
or  on  length  of  service. 

The  methods  of  initiation  just  described  arouse  and 
develop  the  creative  and  other  instincts  which  are  the  only 
sound  foundation  of  industrial  solidarity.  The  new  worker 
is  made  to  feel  himself  a  sharer  in  the  traditions  of  the  new 
group.  Every  college  man  knows  the  value  of  this  in  rousing 
college  spirit,  which  is  closely  akin  to  industrial  esprit  de 
corps. 

Make  the  policies  of  the  firm  clear  to  the  new  employee. 
Make  it  plain  that  he  is  to  help  form  and  maintain  them 
in  the  future.  If  the  firm  has  no  established  policies,  if 
promotion  is  uncertain  and  based  on  opportunism,  then  it 
is  actually  following  a  policy  most  likely  to  encourage  change 
and  indifference  on  the  part  of  its  working  force.  If  the 
concern  has  a  standard  of  workmanship,  salesmanship,  safety 
prevention,  sanitation,  wages,  labor  relations,  or  of  anything 
else,  it  should  be  printed  as  a  part  of  a  book  containing  all 
rules  which  an  employee  should  know.6 


*S.  H.  Slichter,  Turnover  of  Factory  Labor,  1919,  p.  329.     National 


INTRODUCING   THE   NEW   EMPLOYEE 

Book  of  Rules  and  Policies 

Such  a  book,  once  thought  to  be  of  no  possible  importance 
in  employment  relations  save  as  a  warning  of  things  for- 
bidden, is  coming  more  and  more  to  be  recognized  as  one 
of  those  "little  things"  that  may  prove  big  stumbling  blocks 
or  very  helpful  foundation-stones  upon  which  to  build.  Some 
firms  take  the  trouble  to  have  the  name  of  the  new  employee 
typed  upon  the  front  of  the  book  before  it  is  handed  to  him. 
Others  include  blank  pages  in  the  back  for  memoranda,  wage 
tables,  or  shop  information  that  is  most  apt  to  be  needed 
in  the  beginning.  Such  a  booklet  might  well  contain  a  short 
history  of  the  firm  and  the  place  that  it  fills  in  the  industrial 
world.  It  might  well  explain  the  source  of  the  raw  material 
used  and  the  principal  markets  for  the  finished  product.  It 
should  certainly  tell  of  any  notable  achievements  in  the  way 
of  size  and  quality  of  product;  but  the  subject  of  quantity 
of  product  per  employee  will  not  always  bear  such  conspicuous 
presentation,  especially  if  it  is  so  represented  as  to  suggest 
immediate  emulation. 

Preparation  of  the  Booklet 

The  preparation  of  this  booklet  calls  for  the  help  of  the 
advertising  department.  The  best  advertisement  writers  are 
well  aware  of  the  value  of  trade  policies  and  traditions  in  a 
sales  campaign.  They  often  spend  weeks  in  studying  the 
history  and  operations  of  a  firm  in  order  the  better  to  present 


Association  of  Corporation  Schools,  Bulletin  Jan.  1920,  contains  a  study 
of  various  such  books  issued  by  leading  firms,  with  discussion  of  their 
merits.  It  is  noted  that,  "one  company  puts  itself  on  record  as  distinctly 
opposed  to  a  policy  of  endeavoring  to  reach  new  employees  by  a  'book  of 
rules'  method.  This  company  undertakes  to  form  an  intimate  and  per- 
sonal contact  with  its  new  employees  and  to  give  them  personally  such 
preliminary  instruction  as  they  may  need.  They  are  accompanied  by  a 
representative  of  the  employment  department  to  the  department  in 
which  they  expect  to  work  and  personally  introduced  to  the  foreman 
whose  duty  it  is  to  give  the  new  man  such  instruction  as  may  be  neces- 
sary." 


1 10  PERSONNEL   RELATIONS   IN   INDUSTRY 

such  policies  to  the  public.  There  is  almost  no  limit  to  the 
money  spent  in  preparing  the  copy,  planning  the  layout,  and 
generally  making  attractive  the  pamphlets  designed  to  gain 
the  favor  of  the  customers.  It  is  just  as  important  to  a  firm 
to  sell  its  policies  to  a  new  worker  in  exchange  for  his  good- 
will as  it  is  to  secure  the  similar  good-will  of  many  customers. 
The  idea  that  should  determine  every  step  in  the  preparation 
of  such  a  booklet  is  to  sell  the  firm  to  the  new  employee  so 
that  it  will  stay  sold. 

Steps  in  Initiation 

Some  mechanical  steps  in  the  initiation,  while  they  are 
not  apt  to  be  overlooked,  often  lack  systematization.  Each 
worker  must  be  equipped  with  an  identification  badge,  clock 
card,  tool  check,  locker  keys,  etc.  These  he  should  receive 
from  one  place,  with  instructions  for  their  use.  He  should 
give  a  receipt  for  them  and  know  to  whom  he  is  responsible 
for  their  loss. 

The  object  of  any  welfare  work  and  any  special  privileges 
of  the  employees  should  be  made  clear.  If  medical  care,  first 
aid,  hospital,  nurse,  loans,  restaurant,  or  other  services  are 
supplied  the  new  employee  should  be  told  exactly  how  to  avail 
himself  of  them.  In  making  known  the  benefits  of  these 
policies  hostility  is  easily  aroused.  If  they  are  described  as 
favors  of  the  management,  furnished  with  the  desire  to 
patronize  the  worker,  his  instinct  of  self-respect  will  be  so 
antagonized  as  to  offset  any  good-will  the  prospective  favors 
might  have  brought. 

Some  firms  maintain  benefit  associations,  membership  in 
which  is  compulsory.  The  advisability  of  such  compulsory 
favors  is  doubtful,  but  if  they  are  a  part  of  the  firm's  policy 
they  should  be  thoroughly  explained  when  the  new  member 
is  given  his  card. 

Even  with  the  greatest  care,  many  new  habits  must  be 


INTRODUCING  THE  NEW  EMPLOYEE  I" 

formed  and  new  things  found  out  unaided.  So  it  is  well 
worth  while  to  explain  such  apparently  small  things  as  the 
location  of  exits,  fire  alarms  and  apparatus,  tool-,  stock-,  and 
lunch-rooms,  and  all  conveniences,  making  the  newcomer  as 
familiar  with  his  surroundings  as  possible.  Every  new  situa- 
tion requires  a  new  adjustment.  Every  request  for  informa- 
tion is  apt  to  be  accompanied  by  a  slight  feeling  of  discomfort 
and  embarrassment.  The  cumulative  effect  of  such  things 
causes  a  large  percentage  of  workers  to  quit  their  jobs  before 
they  have  ever  become  a  part  of  the  new  group. 

There  should  be  an  early  introduction  to  the  "safety  first" 
movement,  with  an  explanation  of  the  methods  used  in  the 
plant  to  secure  the  co-operation  of  all  in  preventing  accidents. 
There  should  be  standard  instructions  to  each  foreman  to 
give  warning  against  any  special  hazards.6  It  should  not 
be  forgotten  that  the  newness  of  the  employee  is  in  itself  a 
prolific  cause  of  accidents.7 

Introduction  During  Instruction  Period 

The  greatest  opportunity  for  proper  introduction  into  the 
new  group  comes  with  the  work  of  instruction.8  Helping 
the  employee  to  learn  the  new  job  brings  immediate,  tangible 
results.  If  properly  done  it  lessens  fatigue,  increases  earn- 
ings, shortens  the  period  of  low  pay  and  mental  discomfort, 
and  gives  exceptional  opportunity  to  win  his  confidence  and 
initiate  him  into  the  policies  of  the  firm. 

One  of  the  largest  single  contributing  forces  to  labor 
turnover  is  the  willing  quitting  of  the  worker  because  he 
does  not  KNOW  his  work  and  is  therefore  in  danger  of 


'Proceedings  Employment  Managers  Conference,  Boston,  May,   1916, 
Bureau  of  Labor  Statistics,  Bulletin  No.  202,  pp.  36,  37. 

7  S.  H.  Slichter,  Turnover  of  Factory  Labor,  1919,  pp.  137-140. 
'  Ibid.,  pp.  137-140. 


112  PERSONNEL   RELATIONS   IN   INDUSTRY 

being  fired.  Rather  than  wait  for  the  time  to  come  when 
the  "boss"  shall  discover  his  ignorance  and  consequent  poor 
workmanship,  the  worker  quits,  knowing  he  stands  a  better 
chance  of  employment  elsewhere  by  this  means  than  were 
he  to  be  discharged.9 

If  the  plant  uses  time  and  motion  study,  an  introductory 
training  is  required  to  explain  and  adjust  the  workers  one  by 
one  to  the  new  methods  before  they  have  acquired  bad  habits. 
Thorough  instruction  at  the  beginning  discovers  and  removes 
incompetence,  by  training  or  discharge,  before  the  new  em- 
ployee has  had  time  extensively  to  damage  materials.  The 
work  of  testing  the  selection  of  employees  is  done  during  the 
instruction  period.  Such  work  requires  especially  trained 
foremen  or  teachers.  The  methods  of  organizing  and  con- 
ducting training  departments  and  vestibule  schools  belong  to 
a  later  chapter. 

Outside  and  Home  Influences 

Once  the  worker  has  really  entered  the  industrial  group, 
arrangements  should  be  m'ade  for  a  visit  to  the  home  by  the 
nurse  or  a  representative  of  the  employment  department.  A 
warning  should  be  sounded  however  against  the  dangers  in 
connection  with  such  visits.  Social  workers  tell  a  story,  the 
age  and  frequent  repetition  of  which  prove  its  value  as  an 
accurate  illustration. 

My  Lady  Bountiful,  in  a  spasm  of  democratic  condescen- 
sion, invited  the  little  daughter  of  a  protege  to  visit  her 
luxurious  home.  The  little  girl  opened  the  conversation  with, 
"Does  your  husband  drink?" 

"What?" 

"Does  he  save  his  money?"  continued  the  little  visitor. 


*  H.  N.  Clarke,  Breaking  in  the  New  Workers,  Industrial  Management, 
June,  1919,  p.  406. 


INTRODUCING   THE    NEW   EMPLOYEE  1 13 

"What  do  you  mean?  You  are  insulting.  How  dare  you 
ask  such  questions!"  exploded  my  Lady  Bountiful. 

"Well,"  sobbed  the  little  girl,  "my  mamma  told  me  to  talk 
like  a  lady,  and  all  the  ladies  who  visit  us  ask  those  questions." 

Questions  that  invade  privacy  and  antagonize  the  instincts 
of  self-respect,  natural  secretiveness,  and  home  sanctity  are 
the  worst  sort  of  introduction  to  the  plant  group.  On  the 
other  hand,  if  the  firm  or  the  industrial  group  has  any 
privileges  to  offer  the  family,  any  social  organizations,  pur- 
chasing advantages,  insurance  work,  or  other  features  that 
interest  the  non- working  members  of  the  family,  these  should 
be  explained  in  a  straightforward,  businesslike  manner,  trust- 
ing to  their  influence  to  unite  the  parental  and  home-making 
instincts  with  those  of  the  factory  group. 


CHAPTER  VIII 

INTERESTING    LABOR    IN    INDUSTRY 

The  Worker's  Loss  of  Interest 

The  worker's  loss  of  interest  in  his  work  is  an  individual 
and  social  tragedy.  After  the  disappearance  of  chattel  slavery 
and  serfdom  the  wage  system  depended,  as  a  final  resort,  upon 
the  whip  of  hunger  to  drive  laborers  to  work.  When  the 
employer  ceased  to  be  the  master  craftsman  and  depended 
upon  possession  alone  to  hold  his  position  of  industrial  man- 
ager, leadership  in  industry  and  the  personal  relations  based 
upon  leadership  lost  their  hold  upon  the  mass  of  workers. 
Specialization  in  both  work  and  management,  with  the  sub- 
divisions of  the  machine  process,  took  away  that  share  in  the 
planning  and  that  vision  of  the  finished  product  which  is  the 
foundation  of  the  spirit  of  craftsmanship  and  individual 
initiative. 

Dangers  of  Indifference 

So  long  as  an  army  of  unemployed  made  it  possible  to 
hold  the  threat  of  discharge  above  the  worker  and  to  drive 
him  unwillingly  to  work,  this  loss  of  interest  was  not  entirely 
fatal  to  industry.  Nevertheless,  this  absence  of  labor's  interest 
in  industry  has  been  one  of  the  greatest  obstacles  to  efficiency 
with  regard  to  quantity  and  far  more  so  with  reference  to 
quality.  With  even  a  momentary  disappearance  of  the  army 
of  unemployed  the  problem  became  one  of  the  very  continu- 
ance of  industry 

The  war  emergency,  and  even  more  the  reconstruction 
period,  brought  a  recognition  to  our  entire  civilization  of  the 

114 


INTERESTING   LABOR   IN   INDUSTRY  "5 

threat  which  lies  in  this  situation.  We  are  seeing  that  it 
threatens  the  paralysis  of  industry,  the  destruction  of  skill, 
and  the  disruption  of  society.  All  over  the  world  there  is  a 
sudden  awakening  to  the  measureless  value  of  having  the  body 
of  producers  interested  in  production  and  the  product. 

Value  of  Industrial  Good-will 

Today  we  are  being  forced  by  expensive  and  painful 
experience  to  realize  the  full  truth  of  John  R.  Commons' 
statement  that: x 

Industrial  goodwill  is  a  valuable  asset  like  commercial 
goodwill  and  good  credit,  and  becomes  so,  more  and  more, 
in  proportion  as  laborers  acquire  more  liberty,  power,  in- 
telligence and  more  inclination  to  assert  their  liberties.  It 
too  is  valuable  because  it  brings  larger  profits  and  lifts  the 
employer  somewhat  above  the  level  of  competing  employers 
by  giving  him  a  more  productive  labor  force  than  theirs 
in  proportion  to  the  wages  paid.  And  this  larger  profit 
reflects  itself  in  the  larger  value  of  stocks  and  bonds,  the 
higher  capitalization  of  the  going  business.  .  .  . 

But  goodwill  is  fragile  as  well  as  intangible.  It  is  not 
merely  past  reputation,  it  requires  continuous  upkeep  through 
continuous  repetition1  of  service.  It  breaks  down  easily  by 
deterioration,  for  it  is  built  up  on  the  most  fragile  of  assets, 
the  freedom  of  the  will  of  patrons  or  workers. 

The  absenee  of  this  industrial  good-will,  of  a  willingness 
to  produce,  of  interest  in  the  work,  is  the  cause  of  the  much 
complained  about  restriction  of  production  by  labor.  It  is 
the  reason  for  "ca'  canny,"  for  objections  to  machinery,  for 
limitation  of  output,  for  disregard  of  workmanship.  These 
effects  are  natural  and  almost  inevitable  reactions  from  defects 
in  management.  A  leader  who  fails  to  lead  always  blames 


1 J.  R.   Commons,  Industrial  Goodwill,   1919,  p.  26. 


Il6  PERSONNEL  RELATIONS   IN  INDUSTRY 

his  followers.    If  labor  refuses  to  give  good-will  there  is  no 
way  to  force  its  surrender. 

Reasons  for  Absence  of  Good-will 

Since  we  are  dealing  here  with  "wills,"  either  good  or 
bad,  it  is  manifest  that  we  must  once  more  seek  a  solution 
in  psychology.  All  personnel  relations  are  psychical  relations. 
Much  of  successful  management  is  based  upon  a  knowledge 
of  psychology  and  most  of  the  failures  are  due  to  ignorance 
of  the  same  subject. 

Efficiency  in  transacting  business  requires  that  one  ob- 
serve, learn,  remember,  think,  form  habits,  exercise  will 
power,  influence  the  actions  of  others,  etc.  In  order  to  have 
skill  in  influencing  men  one  must  have  knowledge  of  the 
mental  processes,  the  predispositions,  and  qualities  of  char- 
acter which  determine  the  course  of  their  thinking,  feeling 
and  acting.  Psychology  is  the  science  which  gives  an  under- 
standing of  these  things.2 

What  creates  the  desire  to  work  ?  What  blocks  it  ?  How 
can  the  desire  be  awakened?  How  can  the  awakened  desire 
be  satisfied  through  the  action  of  the-industrial  group  ?  These 
are  the  questions  that  arise  when  we  analyze  the  reasons  for 
the  absence  of  good-will  in  and  towards  industry  in  those 
who  do  most  of  the  work. 

Instinctive  Desire  to  Work 

The  moment  we  examine  the  nature  of  man  we  find  that 
the  desire  to  work,  instead  of  being  something  artificial  and 
requiring  cultivation,  is  a  deep,  inbred  instinct  that  is 
extremely  difficult  to  suppress.  The  instinct  of  gregarious- 
ness,  also,  is  one  which  gives  great  pleasure  through  its  satis- 
faction. It  is  the  foundation  of  nearly  all  human  associations 


*G.  R  Eastman,  Psychology  and  Business  Efficiency,  1916,  p.  12. 


INTERESTING  LABOR  IN   INDUSTRY  "7 

through  which  pleasure  is  sought.  Industry  today,  if  its 
capacities  were  properly  utilized,  offers  a  greater  opportunity 
for  the  use  of  that  instinct  than  any  method  of  production 
man  has  yet  discovered.  That  the  gratification  of  instinct 
is,  in  itself,  not  only  useful  and  necessary  to  life,  but  one 
of  the  most  fruitful  sources  of  pleasure,  is  a  fact  whose  full 
importance  industrial  management  has  not  yet  realized. 

In  this  connection  John  A.  Hobson,  the  political  economist, 
remarks : 3 

In  examining  these  organic  activities  lying  at  the  basis 
of  human  industry,  we  shall  light  at  the  outset  upon  one 
fact  of  extreme  significance,  viz.,  that  to  each  of  these  or- 
ganically useful  efforts  Nature  has  attached  some  definite 
physical  or  psycho-physical  enjoyment.  Hunting,  fighting, 
mating,  the  care  and  protection  of  the  young,  indeed  all 
actions  which  possess  what  is  called  "survival  value"  or 
biological  utility,  are  endowed  with  a  pleasure  bonus  as  a 
reward  for  their  performance.  Nature  endows  most  or- 
ganically useful  efforts  with  concurrent  enjoyment. 

To  whatever  source^ then  we  trace  the  origins  of  industry, 
to  the  use  of  weapons,  snares  and  other  male  apparatus  for 
the  fight  and  hunt,  to  the  institution  of  play,  imitation  and 
adornment  as  modes  of  self-expression  and  pride,  or  to  the 
more  distinctively  utilitarian  work  of  women  and  slaves 
around  the  home,  we  find  play  or  pleasure  mingled  with  the 
work. 

Pleasure  Through  Gratification  of  Instincts 

If  we  are  to  discover  the  methods  by  which  once  more  to 
unite  pleasure  with  work,  we  must  analyze  the  means  by  which 
these  two  became  separated.  We  must  know  the  elements 
which  afford  gratification  in  the  process  of  production.  One 
of  the  most  important  of  these  elements  is  the  joy  of  planning 
things  to  be  created.  This  involves  initiative,  invention,  crea- 

'J.  A.  Hobson,  Work  and  Wealth,  1914,  p.  21. 


Il8  PERSONNEL   RELATIONS   IN  INDUSTRY 

tion.  It  is  part  of  the  joy  of  adventure  and  discovery.  An- 
other element  of  gratification  comes  from  the  chance  to  grow 
along  with  the  work,  to  improve  in  ability  and  in  social  well- 
being  as  expressed  today  in  income.  Another  source  of  joy 
comes  from  the  vision  of  the  completed  work  while  it  is  still 
in  process  and  from  the  full  consciousness  of  the  relation 
of  the  worker  to  that  product.  These  are  the  elements  that 
have  given  joy  to  workmanship  in  every  stage  of  the  history 
of  the  race.  They  were  all  most  clearly  in  evidence  in  the 
great  craftsmanship  period  of  the  Middle  Ages,  when  the 
handiwork  of  man  reached  a  perfection  it  has  never  since 
attained.  The  characteristics  of  truly  artistic  work  are  that 
it  is  the  most  perfect,  the  most  pleasurable,  and  the  most 
universally  profitable  form  of  human  labor. 

One  by  one  these  most  valuable  elements  of  human  indus- 
try have  been  destroyed,  until,  as  Helen  Marot,  observes:  * 

The  whole  industrial  arrangement  is  carried  on  without 
the  force  of  productive  intention;  it  is  carried  forward 
against  a  disinclination  to  produce.  .  .  .  Industry  was  shorn 
of  adventure  for  the  common  man.  Adventure  in  industrial 
enterprise  is  the  business  man's  great  monopoly.  His  impe- 
tus is  not  due  to  his  desire  to  create  wealth  but  to  exploit 
it,  and  he  secures  its  creation  by  "paying  men  off."  Com- 
monly he  is  peevishly  expectant  that  those  he  pays  off  will 
have  a  creative  intention  toward  the  work  he  pays  them  to 
do,  although  in  the  scheme  of  industry  which  he  supports 
the  opportunity  provided  for  such  intention  is  negligible. 
An  efficiency  engineer  estimated  that  there  is  a  loss  of  wealth 
of  some  fifty  per  cent,  due  to  the  inability  of  the  business 
man  to  appraise  the  creative  possibilities  in  industry. 

Need  of  Restoring  Pleasure  in  Production 

The  biggest  problem  of  personnel  relations  in  industry  is 
the  restoration  of  the  elements  of  pleasure  in  production.   The 


*  Helen  Marot,  Creative  Impulse  in  Industry,  1918,  p.  15.     Italics  in 
original. 


INTERESTING   LABOR   IN   INDUSTRY  "9 

really  far-sighted  managers  of  industry  are  realizing  that  such 
restoration  will  do  more  to  improve  quality  and  increase  quan- 
tity in  production  than  any  other  single  thing.  They  are  also 
seeing  that  the  attempt  to  suppress  the  instinct  of  craftsman- 
ship and  to  steal  away  its  advantages  from  the  mass  of  the 
workers  for  the  benefit  of  a  few  is  the  most  wasteful  and 
destructive  blow  ever  struck  at  social  well-being.5  They  are 
realizing  with  A.  Lincoln  Filene,  the  great  Boston  merchant, 
that:8 

Management  has  sometimes  lost  sight  of  the  goal  which 
it  has  in  common  with  labor.  It  has  been  blinded  perhaps 
by  a  narrow  point  of  view,  a  rigid  devotion  to  rule  of  thumb, 
and  indifference  to  the  greatest  factor  in  production — the 
human  factor.  Income  without  satisfaction  in  work  means 
labor  instability,  unrest  and  lowered  output.  And  satisfac- 
tion in  work  is  hardly  possible  without  recognition  by  man- 
agement of  the  human  elements  involved.  Like  all  other 
human  beings  the  worker  is  a  bundle  of  instincts.  He  wants 
to  create,  to  possess,  to  gain  power,  to  have  his  work  and 
merit  prpperly  recognized,  to  play,  to  protect  himself  and 
his  own.  He  wants  to  learn  new  things,  to  vary  his  occupa- 


8  "Every  employer  knows  that  he  would  not  for  long  be  prosperous 
if  he  repressed  or  had  repressed  every  desire  to  put  himself  into  his 
business.  He  does  not  care  how  long  he  works  if  only  he  can  have  the 
satisfaction  of  seeing  his  desires  bear  fruit.  The  workingman  has 
exactly  the  same  desires,  and  if  they  cannot  find  expression  in  making 
his  job  better,  they  will  break  out  in  some  other  form.  The  energy  and 
brains  that  might  as  well  go  into  the  business  for  the  betterment  of  all 
may  find  a  destructive  outlet  inside  or  outside  the  plant.  The  whole 
movement  for  democracy  throughout  the  world  is  only  an  effort  to  express 
desires — desires  that  every  one  of  us  has  in  some  form  or  other. 
Directors  of  industry  have  two  courses  before  them :  they  can  fight  the 
desire  of  the  workingman  for  recognition  and  representation  on  an 
equal  plane  as  a  component  part  of  industry,  or  they  can  all  combine  to 
hitch  their  desires  in  double  harness  and  put  into  business  the  will  and 
brain  of  every  individual — for  every  individual  has  a  will  and  brain  even 
if  long  disuse  makes  him  act  as  if  he  had  none." — W.  R.  Basset,  When 
the  Workmen  Help  You  Manage,  1919,  p.  24. 

"A.  L.  Filene,  treasurer  and* general  manager  of  William  Filene  Sons 
Co.,  The  Key  to  Successful  Industrial  Management,  Annals  of  the  Ameri- 
can Academy,  Sept.  1919,  p.  9. 


120  PERSONNEL   RELATIONS    IN    INDUSTRY 

tion  so  that  it  does  not  get  on  his  nerves.     He  wants  the, 
satisfactions  which  make  life  worth  living. 

Unless  industry  can  be  so  transformed  as  to  gratify  these 
instincts,  then  industry  and  the  civilization  built  upon  it  will 
break  down  and  disappear. 

Methods  of  Arousing  Interest 

Because  scientific  personnel  relations  are  bringing  about 
such  a  transformation,  they  offer  the  greatest  possibility  of 
meeting  this  problem.  They  propose  an  adjustment  of  the 
worker  according  to  interests  and  abilities  in  the  midst  of 
helpful  surroundings.  They  establish  institutions  to  give  full 
outlet  for,  and  gratification  of,  his  desires  for  planning  and 
direction.  They  offer  an  opportunity  for  him  to  grow  with 
his  work  and  to  share  in  its  prosperity.  This  is  the  only 
basis  for  good- will  between  the  employee  and  the  industrial 
process. 

Educational  Work 

The  first  step  to  this  end  is  comparatively  simple  and 
somewhat  superficial.  The  worker  must  be  given  a  full  under- 
standing, not  only  of  the  great  industrial  processes  of  which 
he  is  a  part,  but  of  the  ends  toward  which  that  industry  is 
tending  and  of  his  share  in  determining  that  development. 
Through  such  familiar  methods  as  lectures,  moving  pictures, 
shop  organs,  trade  journals,  technical  books  and  periodicals, 
and  especially  by  proper  education  both  in  the  schools  and  the 
shops,  the  theoretical  foundation  of  craftsmanship  may  be 
laid.  This  educational  work  should  give  the  laborer  a  knowl- 
edge of  industry  as  a  whole.  He  must  be  familiar  with  its 
history  and  the  mechanical  and  personal  changes  that  it  has 
undergone.  Upon  this  fascinating  story  the  labor  movements 
of  the  world  rest  for  their  arguments.  Labor  journals  and 


INTERESTING  LABOR   IN   INDUSTRY  121 

all  the  literature  of  the  working-class  movement  are  filled  with 
industrial  history. 

General  industrial  history  should  be  related  to  the  history 
of  the  special  industry  in  which  the  worker  is  engaged  and 
integrated  with  that  of  the  particular  firm  where  he  is  work- 
ing. He  accordingly  sees  his  direct  relation  to  great  world 
processes.  The  history  of  the  firm  is  one  in  which  the  worker 
is  going  to  write  a  part,  and  he  wishes  to  know  what  others 
have  done  and  in  what  direction  the  whole,  of  which  he  is 
a  part,  is  moving.  Such  a  history  should  explain  the  firm 
policies.  If  these  have  not  been  formulated  in  shape  for 
statement,  the  discovery  of  that  fact  uncovers  a  defect  in 
management  which  should  be  changed. 

Bring  out  the  source  of  materials  and  the  destination  of 
the  product.  Tell  the  story  of  costs,  sales,  methods  of  market- 
ing, and  mechanical  transformations.  Changes  in  trade  prac- 
tice and  possibilities  of  improvements  finally  unite  each  job 
to  the  entire  process,  if  a  thorough  job  analysis  has  made  the 
information  available.  If  time  and  motion  studies  have  been 
made,  here  is  a  chance  to  show  the  latest  standards  attained 
in  certain  typical  jobs  and  to  secure  the  co-operation  of  the 
worker  in  raising  these  standards,  which  he  will  then  see  as 
stages  in  a  long  process.  He  will  feel  himself  as  an  important 
link  in  that  process,  and  will  wish  his  contribution  to  be 
worthy  of  all  the  others  who  have  worked  and  will  work 
with  him  in  an  endless  historical  line.7 

'  "Motion  study  makes  all  activity  interesting.  .  .  .  Motion  s*udy  con- 
sists of  analyzing  an  activity  into  its  smallest  possible  elements  and  from 
the  results  synthesizing  a  method  of  performing  the  activity  that  shall  be 
more  efficient.  .  .  .  The  process  of  motion  study  is  such  as  to  interest 
the  worker.  .  .  .  Our  methods  of  making  motion  study  are  by  the  micro- 
motion,  simultaneous  motion,  cycle  chart,  and  chronocyclegraph  methods. 
All  make  it  imperative  that  the  worker  shall  understand  what  is  being 
done  and  why,  and  make  it  most  profitable  to  everyone  that  the  worker 
shall  be  able,  as  well  as  willing,  to  help  in  the  work  of  obtaining  methods 
of  least  waste  by  means  of  motion  study." — F.  B.  Gilbreth,  Applied  Motion 
Study,  1917,  pp.  202,  203. 


122  PERSONNEL   RELATIONS   IN   INDUSTRY 

Selling  €he  House  Policies 

This  method  of  arousing  interest  is  the  one  which  modern 
advertising  has  found  most  valuable  also  in  interesting  con- 
sumers. All  good  advertising  writers  now  insist  upon  the 
necessity  of  thorough  familiarity  with  all  the  broader  relations 
of  the  firm,  its  history,  policies,  and  methods  of  work,  as  a 
preliminary  to  presenting  its  products  to  the  public.  The 
salesman  is  drilled  in  these  things,  and  they  are  the  foundation 
of  selling  slogans. 

Fred  H.  Colvin,  assistant  editor  of  the  American  Machin- 
ist, has  noted  that : 

Every  progressive  concern  goes  to  considerable  expense 
and  uses  great  care  to  arouse  enthusiasm  in  salesmen  re- 
garding the  merits  of  their  product.  Every  salesman  can  do 
better  work  with  a  firm  conviction  that  the  product  he 
sells  has  many  points  of  superiority  over  rival  products. 
Yet  few  firms  pay  any  attention  as  to  whether  the  men  and 
women  who  make  the  product  even  know  what  it  is  for. 
Is  it  not  reasonable  to  suppose  that  if  the  workers  can  be 
enthused  over  the  product,  perhaps  by  the  same  or  by  en- 
tirely different  methods  than  are  used  for  the  salesmen, 
that  they  will  try  to  make  it  even  better,  or  at  least  to  main- 
tain its  quality  ?  8 

Subsequent  Value  of  Explanatory  Work 

Such  an  educational  explanation  should,  of  course,  precede 
the  installation  of  any  new  method  of  planning  or  routing 
work,  or  any  change  in  shop  organization.  Without  this 
introduction  such  plans  will  find  hard  running  in  the  factory. 
But  if  they  have  been  preceded  by  thorough  instruction  con- 
cerning the  chain  of  processes  in  the  plant  and  the  inter- 
dependence of  the  various  departments  upon  one  another,  the 
road  will  be  much  smoother. 


•F.  H.  Colvin,  Labor  Turnover,  Loyalty  and  Output,  1919,  p.  13. 


INTERESTING  LABOR   IN  INDUSTRY  123 

This  method  offers  an  opportunity  for  the  use  of  execu- 
tives as  teachers  and  lecturers,  and  for  the  development  of 
talent  for  such  work  within  the  force.  A  live  advertising 
department  can  help  in  teaching  the  technique  of  presenting 
facts.  This,  in  turn,  will  also  help  the  advertising  depart- 
ment. Dull  commonplace  presentations  of  facts  to  employees 
are  no  more  effectual  in  arousing  interest  than  are  similar 
methods  in  reaching  and  holding  customers.  Yet  firms  that 
will  spend  hundreds  of  thousands  of  dollars  to  catch  the 
attention  and  hold  the  good-will  of  constantly  changing  cus- 
tomers, will  begrudge  a  few  cents  spent  to  secure  the  interest 
and  good-will  of  the  men  and  women  whose  life  work  is 
bound  up  in  the  plant  and  who  have  it  in  their  power  to 
make  or  break  the  firm. 

Integrating  the  Worker  with  Industry 

Nevertheless  this  explanatory  and  educational  work,  no 
matter  how  well  done,  will  be  largely  futile  if  it  is  left  to 
stand  alone.  It  must  be  looked  upon  as  merely  introductory, 
requiring  a  follow-up  like  the  advertising  designed  to  bring 
inquiries.  It  is  all  preparatory  to  the  real  work  of  actually 
integrating  the  worker  with  the  industry,  of  putting  substance 
into  the  selling  talk.  To  stop  after  telling  the  employee  the 
story  of  the  process  of  which  he  is  a  part,  only  to  preach  to 
him  about  his  solidarity  with  the  industry,  is  but  to  tanta- 
lize and  aggravate  his  instinctive  desire  to  share  in  that 
process. 

This  is  a  fact  which  every  organizer  of  revolt  among  the 
workers  understands  full  well,  and  is  the  reason  why  he 
always  emphasizes  industrial  history.  One  fundamental  prob- 
lem of  the  labor  movement  which  cannot  be  disregarded, 
is  that  of  the  restoration  to  the  mass  of  workers  of  that 
common  sharing  in  the  destiny  and  direction  of  the  industry 
which  is  the  foundation  of  craftsmanship. 


124  PERSONNEL  RELATIONS   IN   INDUSTRY 

Restoring  Power  to  Gratify  Instincts 

The  problem  of  good-will  in  industry  is  the  problem  of 
restoring  to  the  productive  process  the  power  to  gratify  the 
instincts  of  gregariousness,  craftsmanship,  and  adventure. 
The  real  leaders  in  industrial  management  are  everywhere 
realizing  that  industrial  progress  depends  upon  the  elimination 
from  industry  of  the  elements  that  are  destructive  to  these 
instincts. 

One  of  the  most  easily  discernible  of  these  elements  is  that 
of  monotony. 

There  is  nothing  so  destructive  of  happiness  and  con- 
tentment as  the  deadly  daily  monotony  of  uninteresting  and 
uninspiring  work.  How  to  make  the  daily  work  interesting 
and  inspiring  to  the  workman  is  the  really  great  problem  of 
the  organization  of  industry.  To  organize  a  factory  or  de- 
partment from  the  standpoint  of  greatest  efficiency  as  a 
purely  productive  undertaking  is  one  thing;  while  at  the 
same  time  to  meet  the  spiritual  and  mental  needs  of  the 
workers  it  becomes  a  very  different  proposition,  but,  never- 
theless, this  is  the  vital  part  of  the  problem.  Purely  manual 
work  requiring  no  play  of  intellect  can  under  no  circum- 
stances appeal  to  the  interest  of  the  workman.  He  must 
feel  an  interest  both  in  the  method  and  the  result;  he  must 
find  exercise  and  play  for  his  mind  and  imagination.  Many 
men  of  independent  power  work  because  they  like  to  work, 
never  realizing  that  the  reason  they  appear  more  industrious 
and  efficient  than  some  others  is  that  they  have  the  privilege 
of  choosing  the  work  that  interests  them,  while,  at  the  same 
time,  it  may  not  have  occurred  to  them  to  give  any  thought 
to  the  question  as  to  whether  or  not  the  work  of  the  sub- 
ordinates is  made  as  interesting  and  inspiring  as  possible.9 

The  problem  of  monotonous  work,  as  we  have  already 
seen,  like  nearly  all  problems  concerned  with  so  complex  a 


*E.    G.    Rust,    Centralization    and    Decentralization    in    Management, 
Annals  of  the  American  Academy,  Sept.  1919,  p.  102. 


INTERESTING  LABOR  IN   INDUSTRY  125 

thing  as  industry,  is  not  one  permitting  a  single  solution. 
Proper  selection  helps  to  assign  it  to  those  to  whom  the 
monotony  is  less  of  a  burden.  Proper  job  analysis  will  often 
find  a  way  to  supplant  it  with  machinery.  Adequate  training 
systems  may  make  of  other  such  positions  stepping-stones  to 
less  monotonous  work.  When  nothing  else  offers,  such  work 
may  be  distributed  and  mixed  with  more  interesting  work. 
Any  work  grows  monotonous  if  it  offers  no  opportunity 
for  planning,  no  view  beyond  the  day's  task,  no  relation  to 
bigger  and  less  monotonous  facts.  All  work  becomes  alive 
and  vital  when  it  engages  the  worker's  initiative  and  offers 
a  field  for  growth  in  both  the  task  and  the  worker. 

Disappearance  of  Initiative  Among  Workmen 

At  one  time  the  American  worker,  more  than  almost  any 
other  contemporary  laborer,  was  intensely  interested  in  his 
work  and  in  methods  of  improving  it.  This  was  the  time 
when  American  working  men  were  granted  more  patents  per 
capita  than  any  national  body  of  workers  before  or  since. 
That  the  number  of  patents  taken  out  by  wage-earners  has 
greatly  declined  is  due  in  part  to  the  greater  complexity  of 
modern  industry.  Many  inventions  are  now  made  through 
the  work  of  highly  skilled  specialists  in  research  laboratories. 
But  the  multiplicity  and  omnipresence  of  machinery  should 
result  in  a  far  larger  number  of  small  but  valuable  improve- 
ments. These  are  not  appearing.  The  worker  does  not 
understand  the  principles  back  of  the  machine  he  uses.  He 
does  not  comprehend  its  full  purpose.  Most  important  of 
all,  he  lacks  the  interest  in  improvements  that  would  not  let 
the  mind  of  the  worker  of  a  former  day  rest  until  he  had 
seen  the  improvement  his  mind  had  conceived  take  form  under 
his  hand.10 

""A  second  and  greater  misapprehension  on  the  part  of  those  who 


126  PERSONNEL   RELATIONS   IN   INDUSTRY 

Managers  have  noticed  this  disappearance  of  initiative 
/and  have  sought  to  arouse  it  by  such  methods  as  suggestion 
boxes,  bonuses,  and  prizes.    These  have  their  value  and  their 
place,  but  they  are  in  the  nature  of  stimulants  and  poultices 
applied  to  an  organic  disease.     As  Helen  Marot  has  pointed 
out,11  "The  doing  of  tasks  in  factories  for  the  sake  of  rewards, 
(gives  the  workers  experience  in  winning  rewards.     As  they 
are  interested  only  in  the  reward,  they  carry  away  no  desire 
or  interest  in  the  work  experience." 

A  Deficiency  of  the  Taylor  System 

The   worker's  interest,  if  it  is  to  run   throughout   the 
process,  must  be  enlisted  in  the  beginning.     He  must  share 
in  the  planning  of  each  step  in  the  work.    This  sounds  impos- 
sible to  the  old-fashioned  manager.     It  is  coming  to  be  seen 
as  the  easiest  and  most  profitable  manner  of  managing  indus- 
»\try.     Scientific  management — the  Taylor  system — began  by 
))  taking  from  the  worker  all  share  in  the  planning.    The  system 


would  do  away  with  democracy  is  concerning  the  mechanism  of  progress. 
Progress  is  largely  the  product  of  invention,  large  and  small.  It  is  thought 
that  centralization  will  re-enforce  discovery  and  that  it  will  rapidly 
spread  new  ideas.  It  must  be  admitted  that  the  opportunities  of  those 
high  in  authority  are  so  great  that  when  it  comes  to  matters  especially 
in  their  charge  they  sometimes  make  more  improvements  than  all  others. 
Frequently  no  one  else  is  in  a  position  fully  to  understand  the  situation. 
But  when  it  comes  to  developments  radically  new,  it  is  more  apt  to  be 
the  other  way.  Those  high  in  authority  under  an  old  system  are  more 
or  less  dubious  about  change.  Furthermore,  they  are  numerically  weak, 
and,  having  little  special  advantage,  the  chances  are  not  one  in  ten 
thousand  that  they  rather  than  some  person  having  no  authority  in  the 
matter,  will  hit  upon  the  fruitful  idea.  Thus  inventions  have  always 
come  from  the  most  unexpected  quarters,  and  the  greatest  of  world 
institutions  have  had,  in  their  beginnings,  to  fight  the  persecutions  of  those 
in  authority.  Originating  power  is  widely  scattered,  no  one  knows  where. 
An  invention,  when  it  comes,  is,  in  its  very  nature,  a  surprise.  The  only 
way  to  gather  the  full  fruits  of  man's  tendency  to  progress  is  to  allow 
the  greatest  possible  number  to  pursue  their  own  ideas,  and  then  trust  that 
the  worthy  innovation  will  fight  its  way  through  to  recognition." — Horace 
B.  Drury,  Democracy  as  a  Factor  in  Industrial  Efficiency,  Annals  of  the 
American  Academy,  May  1916,  p.  25. 

11  Helen  Marot,  The  Creative  Impulse  in  Industry,  1918,  p.  45. 


INTERESTING  LABOR  IN   INDUSTRY  *27 

was  based  upon  the  idea  of  collecting  from  the  whole  body  of 
workers  all  the  trade  knowledge  they  possessed  and  assembling 
this  knowledge  in  a  planning  department.  This  department 
was  to  be  conducted  by  experts,  who  were  to  issue  specific 
detailed  orders  as  to  the  methods  of  work,  which  orders  were 
to  be  obeyed  without  knowledge  or  question.  Frederick  W. 
Taylor  has  himself  set  forth  this  principle  as  follows: 12 

The  first  of  these  four  great  duties  which  are  under- 
taken by  the  management  is  to  deliberately  gather  in  all 
of  the  rule-of-thumb  knowledge  which  is  possessed  by  all 
the  twenty  different  kinds  of  tradesmen  who  are  at  work 
in  the  establishment — knowledge  which  has  never  been  re- 
corded, which  is  in  the  heads,  hands,  bodies,  in  the  knack, 
skill,  dexterity  which  these  men  possess — to  gather  that 
knowledge,  classify  it  and  tabulate  it,  and  in  most  cases  re- 
duce it  to  laws  and  rules;  in  many  cases  work  out  mathe- 
matical formulae  which,  when  applied  with  the  co-operation 
of  the  management  to  the  work  of  the  men,  will  lead  to 
an  enormous  increase  of  the  output  of  the  workmen.  .  .  . 

The  fourth  principle  is  the  deliberate  division  of  the  work 
which  was  formerly  done  by  the  workmen  into  two  sections, 
one  of  which  is  handed  over  to  the  management.  An  im- 
mense mass  of  new  duties  is  thrown  on  the  management 
which  formerly  belonged  to  the  workmen. 

The  attempt  to  put  all  the  "heads"  together  in  the  planning 
department,  leaving  nothing  but  "hands"  in  the  shop,  led 
to  a  righteous  revolt  of  labor,  and  upon  this  rock  scientific 
management  was  almost  wrecked.  There  is  a  common  im- 
pression, carefully  fostered  by  some  of  the  superficial  efficiency 
engineers  who  have  cast  so  much  discredit  upon  a  helpful 
and  earnest  profession,  that  labor  opposed  the  Taylor  system 
only  because  it  increased  production.  On  the  contrary,  the 
indictment  against  it  almost  invariably  rests  upon  the  attempt 


"  F.  W.  Taylor,  Principles  of  Scientific  Management,  in  First  Annual 
Conference  Amos  Tuck  School  on  Scientific  Management,  pp.  32,  35. 


128  PERSONNEL   RELATIONS   IN   INDUSTRY 

to  deprive  the  worker  of  all  pleasure  in  his  work — upon  its 
deadliness  to  the  instinct  of  craftsmanship— an  instinct  as 
valuable  to  the  management  as  to  the  men,  and  most  of  all 
to  society  as  a  whole. 

Labor's  Antagonism  to  the  Taylor  System 

More  important  than  the  specific  protests,  has  been  the 
A  instinctive  recoil  of  the  laborer  everywhere  against  this  effort 
to  deprive  him  of  the  mysteries  of  his  craft,  which  from  the 
days  of  the  guild  and  long  before,  had  been  his  most  valuable 
and  most  pleasure-giving  possession.  Labor  does  not  normally 
wish  to  restrict  output.  Such  action  revolts  the  inbred  in- 
stincts of  craftsmanship  and  is  resorted  to  only  as  a  measure 
of  defence  or  retaliation  against  what  it  believes  to  be  incom- 
petence or  injustice  on  the  part  of  the  management  in  the 
interest  of  ownership.  The  literature  of  the  labor  movement 
is  filled  with  condemnation  of  management  for  its  sins  of 
wastefulness,  incompetence,  and  ignorance  as  causes  of 
restricted  production.13  As  little  good  comes  from  these 
mutual  recriminations,  progress  out  of  this  fight  in  a  blind 
alley  must  be  sought  elsewhere  than  in  charges  and  counter- 
charges. 


"  "A  good  deal  has  been  said  about  restriction  of  output  practiced  by 
workingmen  and  their  organizations.  The  blame  has  been  generally  laid 
on  the  shoulders  of  one  party  alone.  The  fact  is  that  workingmen  have 
universally  condemned  such  restrictions,  or  what  looked  like  it,  perpetrated 
by  their  own  employers.  They  saw,  with  the  clearness  of  experts,  how 
deadening  to  efficient  production  have  been  the  conservatism  in  methods; 
retention  of  plants  long  out  of  date,  inconvenient  in  their  design  and 
wasteful  in  their  demands  on  time  and  energy  which  should  have  gone 
into  the  work  itself ;  they  saw  an  unwillingness  to  make  needed  alterations, 
scrap  antiquated  tools  and  adopt  the  best  current  practice.  They  have 
been  subjected  to  deadening  influences  all  around.  They  know  of  it  and 
speak  of  it.  Good  workmen  do  not  want  to  stay  long  in  such  places, 
because  some  protective  craft  instinct  tells  them  that  their  own  skill  wfll 
suffer  if  they  do.  The  truth  is  that  men  who  have  spent  years  at  a  trade 
and  take  pride  in  their  workmanship  are  among  the  best  critics  of  equip- 
ment, methods  and  managerial  standards." — Meyer  Bloomfield,  Manage- 
ment and  Men,  1919,  p.  37. 


INTERESTING   LABOR   IN   INDUSTRY  129 

From  the  very  beginning  the  enthusiastic  defenders  and 
discoverers  of  the  principles  of  scientific  management  have  had 
a  glimmering  of  the  truth.  It  would  be  wholly  unfair  to 
Frederick  W.  Taylor  to  pass  this  point  without  placing  beside 
the  passage  just  quoted  another  paragraph  from  the  same 
address,  in  which  he  says:  " 

Hardly  a  single  piece  of  original  work  was  done  by  us 
in  Scientific  Management.  Everything  that  we  have  has 
come  from  the  suggestion  of  someone  else.  There  is  no 
originality  about  Scientific  Management.  And,  gentlemen, 
I  am  proud  of  it;  I  am  not  ashamed  of  it,  because  the  man 
who  thinks  he  can  place  his  originality  against  the  world's 
evolution,  against  the  combined  knowledge  of  the  world,  is 
pretty  poor  stuff. 

Affording  Opportunities  for  Original  Work 

Taylor  then  goes  on  to  insist  that  once  a  standard  of  work 
has  been  established  by  investigation  it  should  be  carefully 
learned  and  followed,  and  adds: 

When  you  have  got  to  the  top  by  the  present  method, 
invent  upward.  .  .  . 

That  is  exactly  what  we  say  to  our  men.  We  say, 
"We  do  not  know  the  best;  we  are  sure  that  within  two  or 
three  years  a  better  method  will  be  developed  than  we  know 
of;  but  what  we  know  is  the  result  of  a  long  series  of 
experiments  and  careful  study  of  every  element  connected 
with  shop  practice ;  these  standards  that  lie  belore  you  are 
the  results  of  these  studies.  We  ask  you  to  learn  how  to 
use  these  standards  as  they  are,  and  after  that,  the  moment 
any  man  sees  an  improved  standard,  a  better  way  of  doing 
anything  than  we  are  doing,  come  to  us  with  it;  your  sug- 
gestion will  not  only  be  welcome  but  we  will  join  you  in 
making  a  carefully  tried  experiment,  which  will  satisfy 
both  you  and  us  and  any  other  man  that  your  improvement 

14  F.  W.  Taylor,  Principles  of  Scientific  Management,  in  First  Annual 
Conference  Amos  Tuck  School  on  Scientific  Management,  pp.  48-54. 


13°  PERSONNEL   RELATIONS    IN    INDUSTRY 

is  or  is  not  better  than  anything  before.  If  that  experiment 
shows  that  your  method  is  better  than  ours,  your  method 
will  become  our  method  and  every  one  of  us  will  adopt 
that  method  until  somebody  gets  a  better  one." 

Here  speaks  the  true  scientist,  and  had  this  method  been 
followed  throughout  in  the  introduction  of  scientific  manage- 
ment many  years  of  discouragement  and  much  ill  feeling 
might  have  been  avoided.  Unfortunately  many  of  the  super- 
ficial followers  of  Taylor  forgot  this  advice,  and  it  cannot 
be  said  for  Taylor  that  he  always  followed  it  himself.  More- 
over, until  scientific  personnel  relations,  with  proper?  adjust- 
ment, job  analysis,  and  above  all  adequate  systems  of  training 
and  promotion  were  worked  out  and  applied,  the  machinery 
for  fully  utilizing  the  above  ideal  did  not  exist.  Furthermore, 
the  tendency  to  more  and  more  intense  specialization  in  tasks 
grew  rapidly.  An  apparently  easier  way  and  a  short-cut  to 
greater  immediate  efficiency  was  to  install  a  clever,  if  some- 
times superficial,  planning  department,  with  elaborate  records, 
planning  boards,  detailed  orders,  functional  foremen,  and 
similar  paraphernalia — thus  once  more  trying  to  substitute 
improved  methods  and  machines  rather  than  improved  organ- 
ization of  personnel.  As  is  often  the  case  with  short-cuts, 
this  one  led  into  a  ditch.16  Labor  lost  interest ;  its  suppressed 

u  "With  the  abandonment  of  the  apprenticeship  system  came,  of  neces- 
sity, the  splitting  of  the  work  up  into  operations  so  as  to  enable  less 
skilled  men  to  handle  it.  This  was  the  beginning  of  the  'lathe  hand,' 
tplaner  hand,'  and  'drill  press  machinist,'  which  are  so  common  at  the 
present  time.  Added  to  this  was  the  wave  of  so-called  scientific  manage- 
ment that  swept  over  the  country  and  which  advocated  the  still  further 
division  of  the  work  into  sub-operations  so  that  the  worker  was  no  longer 
a  machinist  in  any  sense,  but  an  'operator'  whose  sole  duty  was  to  per- 
form a  very  few  motions  which  could  not  readily  be  performed  by  the 
machine  itself. 

"To  make  matters  worse  we  began  to  talk  about  'fool-proof  jigs,  to 
advocate  the  centering  of  all  the  brains  of  the  establishment  in  the  office, 
to  plan  out  beforehand  every  operation  and  every  movement  which  the 
worker  must  perform.  We  began  to  separate  the  shop  personnel  into 
thinkers  on  the  one  hand  and  appendages  to  machines  of  various  kinds  on 
the  other;  to  take  out  the  little  remaining  human  elements  and  to  substi- 


INTERESTING   LABOR   IN   INDUSTRY  I31 

instinct  of  craftsmanship  was  replaced  by  indifference,  and 
then  by  hostility  to  the  work  of  production.  Denied  the  oppor- 
tunity to  use  ingenuity  in  improving  production,  labor  found 
a  splendid  opportunity  to  exercise  its  ingenuity  in  avoiding 
production. 

Democratic  Planning — The  New  Spirit 

An  examination  of  the  literature  of  industrial  engineering 
that  has  appeared  since  the  war  shows  that  a  complete  trans- 
formation has  taken  place.  Everywhere  engineers  are  realiz- 
ing that  planning  must  be  made  democratic,  in  industry  as  in 
the  state ;  that  a  planning  department  must  be  fundamentally 
•an  organizing  department,  bringing  to  bear  upon  production 
all  the  mental  ability  to  be  found  in  the  plant  or  that  can  be 
called  in  from  outside.  Only  in  issuing  the  orders  is  there 
room  for  even  the  form  of  autocracy.  This  new  spirit  finds 
one  of  its  best  expressions  in  the  writings  of  Robert  B.  Wolf, 
former  manager  of  the  Spanish  River  Pulp  and  Paper  Mills, 
who,  in  a  meeting  of  the  Taylor  Society,  thus  rebukes  the  older 
schools:  " 

There  is  a  deplorable  tendency  on  the  part  of  some  of 
the  men  who  believe  themselves  to  be  Mr.  Taylor's  follow- 
ers to  have  the  central  planning  department  do  all  the  think- 


tute  an  impersonal  planning  department,  made  up  in  too  many  cases  from 
young  college  graduates  with  little  or  no  shop  experience.  In  other 
words,  we  took  away  all  the  interesting  parts  of  the  work  and  made  the 
men  into  attachments  to  the  machines,  demanding  in  many  cases  that  they 
follow  exact  motions  laid  down  by  others,  in  performing  their  daily  tasks. 

"After  dehumanizing  the  shop,  so  far  as  consulting  with  the  men 
actually  on  the  job  was  concerned,  and  making  the  operators  into  autom- 
atons as  far  as  possible,  we  found  much  discontent,  and  lack  of  interest 
became  noticeable.  But  instead  of  attempting  to  find  the  cause,  to  get 
at  the  real  psychological  reasons  for  the  lack  of  interest,  too  many  shops 
adopted  the  paternal  attitude  and  began  to  'do  things  for  the  employees,' 
and  in  many  cases  to  do  them  in  such  a  patronizing  way  as  to  offset  any 
good  which  they  might  have  accomplished." — F.  H.  Colvin,  Labor  Turn- 
over, Loyalty  and  Output,  1919,  p.  6. 

ia  R.  B.  Wolf,  Bulletin  of  Taylor  Society,  Jan.  1916,  p.  13. 


I32  PERSONNEL   RELATIONS    IN   INDUSTRY 

ing  for  the  organization  and  I  hope  that  the  powers  of  this 
society  will  be  directed  against  this  tendency,  for  it  is  a 
thoroughly  unscientific  procedure.  The  doctrine  that  any 
scientific  method  that  increases  productivity  is  scientific 
management  is  absolutely  erroneous.  Lower  unit  costs  do 
not  mean  more  wealth  when  those  costs  are  obtained  by 
sacrificing  the  mentality  of  the  employee. 

In  another  place  he  explains  in  detail  just  how  such  shar- 
ing in  the  process  of  planning  may  be  brought  about.17  In 
the  work  of  cooking  and  pressing  paper-pulp  the  workmen 
engaged  were  given  full  information  as  to  all  the  processes. 
The  chemical  and  temperature  conditions  by  which  the  best 
results  could  be  obtained  were  first  determined  by  careful, 
scientific  investigation.  Then  these  processes  were  explained 
to  the  employees.  Progress  charts  showing  the  ratio  of 
approximate  approach  to  ideal  conditions  were  posted 
as  guides  and  standards  for  the  craftsmanship  of  those 
who  did  the  work  and  their  co-operation  was  invited  at  every 
point. 

Effect  of  Democratic  Planning 

"The  net  result  of  all  this,"  continues  Wolf,  "was  an 
increase  in  our  production  from  225  tons  per  day  of  the  poor- 
est quality  of  fiber  to  400  tons  per  day  of  fiber  which  today 
is  recognized  as  a  standard  of  excellence  throughout  the  world. 
This  was  done  without  adding  a  single  digester  or  putting  in 
a  single  additional  wet  machine  for.  the  handling  of  the 
finished  product." 

While  these  fundamental  operations  were  not  changed  or 
enlarged,  yet  the  inventive  ability  of  the  men  was  so  aroused 
and  stimulated  over  the  details  of  their  work,  that  their  sug- 


17  R.  B.  Wolf,  Bulletin  of  Taylor  Society,  March  1917,  pp.  5-13.  This 
article  contains  full  statement  of  the  principles  involved  and  practical 
methods,  with  charts,  used  to  attain  the  ends. 


INTERESTING  LABOR  IN   INDUSTRY  133 

gested  improvements  resulted  in  such  a  series  of  cumulative 
changes  as  completely  to  transform  the  plant  within  the  seven 
or  eight  years  the  system  has  been  in  operation.  This  result 
demonstrates  that  the  old  inventive  instinct  is  still  there,  eager 
to  express  itself  if  given  opportunity  and  informed  as  to 
methods  and  material  upon  which  to  work. 

The  same  methods  were  then  transferred  to  the  operation 
of  the  hydraulic  presses,  where  the  pulp  is  squeezed  of  its 
surplus  water  and  made  into  "cheeses."  A  year  was  spent 
in  devising  a  machine  that  would  give  a  record  of  all  the 
processes  and  a  standard  of  correct  operation.  The  posting 
of  the  records  so  obtained  raised  the  standard  of  efficiency 
of  the  men  from  42  per  cent  to  60  per  cent.  But  when  the 
foremen  took  the  apparatus  by  which  these  results  were 
determined,  explained  it  to  each  worker,  and  enlisted  his  in- 
terest in  attaining  the  standard,  the  average  efficiency  rose  at 
once  to  80  per  cent  and  remained  there  continuously.  "This 
was  accomplished  without  resorting  to  piece-work,  bonus, 
or  any  of  the  regular  special  methods  of  payment,"  says 
Wolf,  "our  men  being  paid  by  the  day  throughout  the  entire 
plant  The  interest  that  was  taken  in  the  work  came  abso- 
lutely because  the  men  were  being  furnished  with  a  record 
of  what  they  were  accomplishing,  and  in  the  formation  of  this 
record  there  was  an  opportunity  for  them  to  express  them- 
selves." 

Craft  Spirit  and  Quality 

Competition  in  quality  will  always  rouse  craftsmanship 
and  generally  increase  quantity.  But  incited  competition  in 
quantity  can  never  result  in  anything  more  than  a  sudden 
spurt,  and  then  a  sullen  reaction.  The  instinct  of  workman- 
ship is  not  interested  in  "tonnage,"  "mileage,"  or  any  of  the 
other  terms  by  which  our  national  characteristic  for  big  out- 
put is  expressed.  These  things  are  too  recent  in  industrial 


134  PERSONNEL   RELATIONS   IN   INDUSTRY 

history  to  have  developed  any  instinctive  interest.  But  the 
craft  spirit  is  intensely  interested  in  quality  and  will  respond 
when  offered  opportunity  for  gratification.  It  will  do  this 
with  extra  enthusiasm  if  coupled  with  the  group  instinct. 
Each  worker  must  see  his  work  as  a  contribution,  however 
small,  to  a  planned  and  perfect  whole,  and  acquire  as  much 
knowledge  as  possible  of  the  planning.  The  visitor  to  those 
examples  of  perfect  craftsmanship,  the  great  cathedrals,  is 
constantly  surprised  and  pleased  by  finding  little,  almost  hid- 
den, bits  of  artistic  work  that  bespeak  the  earnest  skill  of 
some  unknown  craftsman,  whose  instinct  for  perfect  work 
and  loyalty  to  the  building  group  would  not  permit  bad  work 
even  though  almost  unseen. 

Here  we  touch  upon  another  element  essential  to  the  grati- 
fication of  the  creative  instinct — the  desire  for  beauty.  The 
hideousness  of  design  that  marks  much  of  the  products  of 
the  machine  age  tends  to  destroy  all  pride  in  the  worl^  If 
the  whole  is  to  be  a  monstrosity,  there  is  no  incentive  to  per- 
fect the  small  part.  If  the  whole  is  foreseen  as  a  thing  of 
beauty,  the  most  careless  worker  will  hesitate  before  marring 
the  vision  of  the  completed  article  by  bad  workmanship. 
There  is  a  most  important  lesson  here  with  regard  to  the 
value  of  beauty  in  a  multitude  of  other  directions,  which  it 
is  most  gratifying  to  note  that  American  industry  is  at  least 
beginning  to  study. 

Industrial  Leadership 

Leadership  is  a  strong  element  in  group  solidarity;  but 
industrial  leadership  has  been  so  often  purely  mercenary  and 
wholly  incompetent  as  to  destroy  or  antagonize  the  group 
instinct.  Leadership  and  management  in  modern  industry 
have  largely  depended  upon  possession.  Only  by  chance  did 
such  possession  carry  with  it  that  master  skill  in  work  or 
even  in  management  that  commands  respect  from  the  trained 


INTERESTING   LABOR   IN   INDUSTRY  135 

craftsman.  Morris  Llewellyn  Cooke  very  appropriately 
reminds  those  who  are  so  ready  to  denounce  labor  for  restrict- 
ing production  that: 18 

We  need  constantly  to  remind  ourselves,  however,  that 
the  employing  class  has  been  guilty  of  many  varieties  of 
sabotage  as,  for  instance,  when  consciously  placing  in 
executive  positions  those  not  fatted  properly  to  carry  on 
their  functions.  If  the  employers  under  the  new  dispensa- 
tion are  to  have  a  right  to  call  upon  their  employees  for 
full  performance,  the  latter  certainly  have  the  right  to 
demand  competent  leadership.  The  day  does  not  appear  to 
be  far  distant  when  this  right  will  be  exerted. 

Difficulties  in  Applying  Principles 

The  principles  that  have  been  discussed  in  this  chapter, 
and  that  are  occupying  the  attention  of  the  best  minds  con- 
cerned with  industrial  management,  are  not  easy  to  carry 
out.  They  cannot  be  introduced  with  the  "hip-hurrah" 
scheme  of  an  inspirationist  who  is  able  to  rouse  enthusiasm 
among  the  men  and  confuse  the  management  with  fine  phrases 
about  justice,  co-operation,  energy,  and  service.  The  instinct 
of  craftsmanship  was  not  destroyed  in  a  moment.  It  cannot 


MM.  L.  Cooke,  The  Problem  of  American  Manufacturers,  Annals  of 
the  American  Academy,  Sept.  1919,  p.  vi. 

"Throughout  our  whole  system  of  production  there  is  a  tendency  to 
blame  the  man  lower  down  rather  than  the  man  higher  up,  with  the  result 
that  the  man  in  the  shop  may  be  reprimanded,  or  even  discharged,  for  an 
error  in  judgment  which  caused  the  loss  of  a  few  dollars,  while  the  man 
at  the  top,  making  a  similar  error  in  judgment  costing  thousands  of 
dollars,  too  frequently  gets  by  without  anybody's  knowing  that  the  loss 
was  due  to  his  failure.  ...  If  the  business  does  not  make  profits  we 
naturally  blame  those  causes  we  can  see,  and  ignore  those  we  can't  see; 
this  is  the  reason  the  shop  gets  the  blame,  and  the  office  often  goes  free. 
If  the  business  makes  money  the  executives  always  get  credit;  but  ffias- 
much  as  the  elements  entering  into  profits  are  numerous  and  intricate,  they 
are  not  by  any  means  a  safe  estimate  for  the  effectiveness  of  executives  as 
producers.  In  fact  many  times  increased  profits  are  made  by  cutting  down 
production,  even  though  the  community  may  be  sadly  in  need  of  the 
product." — H.  L.  Gantt,  Influence  of  Executives,  Annals  of  the  American 
Academy,  Sept.  1919,  pp.  257,  258. 


136  PERSONNEL   RELATIONS   IN   INDUSTRY 

be  restored  by  a  wave  of  the  hand.  Fortunately  it  has  never 
been  more  than  temporarily  suppressed  and  can  be  brought 
into  force  in  much  less  time  than  it  has  taken  to  turn  it  away 
from  its  proper  object.  But  the  restoration  will  require  care- 
ful study,  a  complete  revolution  in  methods  of  management, 
fundamental  reorganization  of  much  of  modern  industry,  and 
a  far  greater  knowledge  and  skill  on  the  part  of  managers 
than  has  hitherto  been  demanded. 


CHAPTER  IX 

TRAINING  * 

Productive  Machinery  versus  Productive  Skill 

For  a  century  industrial  study  was  devoted  to  machines. 
For  a  decade  only  has  much  attention  been  given  to  methods. 
Today  we  find  that  in  neglecting  the  training  of  men  we  have 
disregarded  the  greatest  source  of  potential  power.  So  swift 
and  so  amazing  was  progress  through  mechanical  invention 
that  we  came  to  think  that  by  putting  the  brains  into  the 
machine  we  could  dispense  with  brains  in  the  machine  tender. 
As  a  consequence,  productive  skill  declined  as  productive 
machinery  flourished.  The  skill  of  the  average  worker  is 
probably  less  now  than  in  any  preceding  age.  The  blame  for 
this  must  be  shared  by  school  and  factory,  and  both  may  pass 
it  along  to  universal  indifference.  So  things  have  come  to 
the  point  that  automatic  machines  are  tended  by  unskilled 
laborers,  incapable  of  improving,  replacing,  or  understanding 
the  intricate  tools  they  tend.  Today,  as  invention  declines, 
craftsmanship  disappears,  and  national  industry  is  weakened 
by  a  lack  of  ability  in  the  human  and  after  all  the  only  essen- 
tial element.  Therefore  there  is  a  sudden  widespread  interest 
in  methods  of  cultivating  skill. 

Destruction  of  Craftsmanship 

Dean  Herman  Schneider  of  the  University  of  Cincinnati, 
one  of  the  foremost  authorities  on  industrial  education,  thus 


1  The  whole  subject  of  training  is  best  treated  in  R.  W.  Kelly's  Training 
Industrial  Workers,  1920.  This  work  should  be  consulted  by  those  who 
wish  to  go  further  into  this  subject.  It  also  contains  a  very  complete 
bibliography. 

137 


I38  PERSONNEL   RELATIONS    IN   INDUSTRY 

describes  the  process  by  which  the  machine  industry  has  de- 
stroyed skill  in  the  great  mass  of  workers:  2 

In  the  first  place,  it  is  only  within  the  past  two  or 
three  generations  that  mankind  has  worked  in  masses 
within  walls.  For  centuries  mankind  did  self -directed  work, 
largely  in  the  open  air.  These  were  the  farmers,  the  sea- 
men and  the  forest  rangers.  As  civilization  grew,  a  con- 
stantly increasing  minority  did  self-directed  work,  indi- 
vidually or  in  small  groups,  indoors:  these  were  the  arti- 
sans in  the  skilled  trades,  who  met  the  demands  of  growing 
communities.  Then  came  the  great  change  to  the  factory 
system  through  the  development  of  power  devices;  this 
dates  virtually  from  the  invention  of  the  steam  engine. 

In  the  second  place  the  industrial  worker  formerly  knew 
a  whole  job  rather  than  a  part  of  it;  he  performed  a  great 
variety  of  functions  in  the  completion  of  his  task,  instead 
of  endlessly  repeating  the  same  operation.  The  clock  maker 
made  a  whole  clock,  working  individually,  and  the  necessity 
of  working  out  every  part's  relation  to  every  other  part 
gave  the  worker  a  mental  stimulus,  and,  therefore,  a 
higher  development.  The  finished  product  was  all  his  own ; 
the  desire  for  self-expression,  which  every  man  has,  found 
an  outlet  through  his  work;  and,  once  having  served  his 
thorough  apprenticeship,  he  worked  largely  by  self-direc- 
tion. Under  our  present  highly  organized  industrial  condi- 
tions the  making  of  a  clock  is  subdivided  into  a  large  num- 
ber of  operations.  Each  workman  in  a  clock  factory  makes 
piece  after  piece  of  the  same  kind,  principally  by  feeding 
material  into  a  machine,  and  why  he  does,  he  does  not 
know  and  usually  is  not  told.  We  are  putting  the  brains 
into  the  management  office,  and  making  the  workman  a 
purely  automatic  adjunct. 

For  a  time  there  were  many  who  thought  this  a  natural 
and  desirable  mode  of  evolution.  If  all  progress  could  be 
embodied  in  the  machine,  the  whole  world  could  be  ransacked 

'Herman  Schneider,  Education  for  Industrial  Workers,  1915,  pp.  6,  7. 


TRAINING  139 

for  cheap,  unskilled  labor  to  watch  the  almost  human 
machines.  Apprenticeship  systems  declined.  Training  was 
ignored,  and  the  result  was  the  vast  mob  of  unskilled  adults 
now  the  despair  of  industrial  managers. 

Mental  Demands  of  Middle  Ages 

We  are  learning  that  the  machine,  instead  of  dispensing 
with  the  need  of  an  educated  working  class,  has  accentuated 
that  need.  The  craftsman  of  the  Middle  Ages  or  the  hand- 
worker of  our  grandfather's  day  could  attain  great  skill  in 
his  trade  while  remaining  illiterate.  Trade  ability  was 
handed  from  person  to  person  by  word  of  mouth  and  example. 
It  was  perfected  by  observation  and  council  from  master 
craftsmen.  Few  of  those  who  did  the  marvelous  work  in 
wood  and  stone  of  medieval  times  could  even  read  or  write. 
Nor  had  they  any  need  of  the  knowledge  found  in  such  books 
as  existed.  The  standardized  technical  knowledge  of  the  time 
was  not  so  great  but  that  it  could  be  stored  in  the  mind  of 
the  individual  worker  and  by  him  passed  on.  The  principles 
involved  were  simple,  largely  rule-of-thumb,  and  depending 
upon  trade  habits  and  skill  attainable  by  practice  and  personal 
instruction.  The  plan  of  the  completed  work  was  usually 
carried  in  the  head  of  the  craftsman  and  found  form  only 
when  the  article  came  from  his  own  hands. 

Mental  Demands  of  Modern  Times 

At  all  these  points  the  modern  worker  seems  to  be  sharply 
distinguished  from  his  industrial  ancestors.  He  may  have 
less  need  of  the  keen,  practiced  eye  and  skilful  hand  than  the 
earlier  workman.  He  possibly  does  not  need  the  long  prac- 
tice in  acquiring  habits  of  dexterity  and  the  keen  judgment 
of  form  and  line  that  the  artistic  worker  of  the  hand-tool 
age  required.  We  are  beginning,  however,  to  doubt  these 
conclusions. 


14°  PERSONNEL   RELATIONS   IN  INDUSTRY 

/  There  is  certainly  a  far  broader  knowledge  with  which 
the  machine  worker  of  today  must  be  familiar  if  he  is  to  be 
relatively  as  efficient  as  the  handicraftsman.  He  must  know 
the  thoughts  that  are  embodied  in  the  machine,  and  these  are 
far  more  complex  than  those  demanded  by  skilled  manipula- 
tion of  the  earlier  and  simpler  tools. 

John  R.  Commons  has  vividly  set  forth  the  demands  of 
machine  industry  upon  the  mind  of  the  modern  worker :  * 

The  machine  is  an  iron  brain.  It  is  built  on  theories 
of  mathematics  and  mechanics  that  have  accumulated  since 
the  days  of  Archimedes.  It  moves  by  the  generation  of 
power  that  began  with  the  brain  of  James  Watt,  Michael 
Faraday  and  the  inventor  of  the  gas  engine.  It  is  made 
up  of  metals  and  it  transforms  raw  material  that  can  be 
understood  only  by  a  glimpse  into  chemistry  or  biology. 
The  modern  factory  is  indeed  the  forces  of  nature  obeying 
the  stored-up  thought  of  man. 

Consequently,  the  modern  apprentice,  if  he  becomes  more 
then  a  multiplied  machine-hand  or  an  imitative  journeyman 
must  understand  the  machines  and  the  forces  of  nature 
that  he  is  charged  with  directing.  This  does  not  mean  that 
he  must  be  a  scientist,  engineer,  chemist  or  biologist.  It 
merely  means  that  he  must  think  over  again  and  understand 
the  principles  that  philosophers,  scientists,  engineers  and 
inventors  of  the  past  have  embodied  in  the  workshop  of  the 
present.  If  he  is  rightly  instructed  in  shop  mathematics  and 
mechanical  drawing,  he  is  really  thinking  out  for  himself 
the  thoughts  that  go  back  to  Newton,  Watt  or  Faraday, 
and  applying  them  to  the  machines  and  forces  he  is  pre- 
tending to  manage.  If  he  studies  the  raw  material  he  is 
using,  and  compares  it  with  other  raw  material,  he  is 
getting  into  such  sciences  as  chemistry,  biology  or  com- 
mercial geography. 

The  modern  factory  is  just  as  wonderful  in  its  system 
of  organization,  division  of  labor,  specialization,  and  man- 


*J.  R.  Commons,  Industrial  Education  and  Dependency,  University  of 
Wisconsin,  Bulletin  No.  916. 


TRAINING  I41 

agement  as  it  is  in  its  mathematics  and  engineering.  Con- 
sequently, in  the  third  place,  if  the  apprentice  studies  dif- 
ferent plans  of  shop  organization,  bookkeeping,  cost-keep- 
ing, efficiency,  labor  problems  and  so  on,  he  is  thinking  out 
the  elements  of  accounting,  political  economy,  and  even 
psychology,  as  applied  to  the  business  of  which  he  is  a 
part.  These  studies  open  up  to  him  the  line  of  promotion 
to  foreman,  superintendent,  manager. 

The  Basis  of  Continuing  Progress 

Invention  is  upward  from  present  standards,  as  Taylor 
has  already  told  us.  Such  invention  requires  a  knowledge  of 
present  standards  by  those  who  must  do  the  inventing. 
Present-day  workers  cannot  make  improvements,  cannot  grow 
with  their  work,  cannot  do  their  work  well,  and  certainly 
cannot  enjoy  it  unless  they  have  had  a  training  in  scientific 
fundamentals  such  as  would  have  been  impossible  to  even  the 
greatest  scholar  of  a  century  ago.4  In  spite  of  research  labora- 
tories in  industries  and  the  valuable  work  of  scientists  and 
graduates  of  technical  universities  and  schools,  the  continuous 

4  "Industry  has  ceased  to  be  essentially  an  empirical,  rule-of-thumb 
procedure,  handed  down  by  custom.  Its  technique  is  now  technological : 
that  is  to  say,  based  upon  machinery  resulting  from  discoveries  in 
mathematics,  physics,  chemistry,  bacteriology,  etc.  The  economic  revolu- 
tion has  stimulated  science  by  setting  problems  for  solution,  by  producing 
greater  intellectual  respect  for  mechanical  appliances.  And  industry  has 
received  back  payment  from  science  with  compound  interest.  As  a  con- 
sequence, industrial  occupations  have  infinitely  greater  intellectual  content 
and  infinitely  larger  cultural  possibilities  than  they  used  to  possess.  The 
demand  for  such  education  as  will  acquaint  workers  with  the  scientific  and 
social  bases  and  bearings  of  their  pursuits  becomes  imperative,  since  those 
who  are  without  it  inevitably  sink  to  the  role  of  appendages  to  the 
machines  they  operate.  Under  the  old  regime  all  workers  in  a  craft  were 
approximately  equals  in  their  knowledge  and  outlook.  Personal  knowl- 
edge and  ingenuity  were  developed  within  at  least  a  narrow  range,  because 
work  was  done  with  tools  under  the  direct  command  of  the  worker.  Now 
the  operator  has  to  adjust  himself  to  his  machine,  instead  of  his  tool  to 
his  own  purpose.  While  the  intellectual  possibilities  of  industry  have 
multiplied,  industrial  conditions  tend  to  make  industry,  for  great  masses, 
less  of  an  educative  resource  than  it  was  in  the  days  of  hand  production 
for  local  markets.  The  burden  of  realizing  the  intellectual  possibilities 
inhering  in  work  is  thus  thrown  back  on  the  school." — John  Dewey, 
Democracy  and  Education,  1916,  p.  267. 


142  PERSONNEL  RELATIONS   IN   INDUSTRY 

detailed  progress  in  industry  comes  from  the  inventive  skill 
of  the  multitude  of  workers.  Such  progress  will  halt,  or  move 
with  an  irresolute  step,  unless  labor  knows  the  principles  that 
underlie  production. 

This  knowledge  has  been  so  standardized  that  it  is  proper 
material  for  the  schools  and  is  available  in  all  libraries.  It 
is  the  most  valuable  social  possession  of  our  age,  the  founda- 
tion upon  which  civilization  has  been  built.5  From  every  point 
of  pedagogical  theory  it  should  be  the  main  subject  matter 
of  education.  The  schools  introduce  the  new  citizen  into  a 
commonwealth  based  industrially  upon  the  standardized  facts 
of  improved  production.  Many  other  things  are  a  part  of  a 
cultured  life,  and  there  is  need  for  knowledge  of  arts  and 
literature,  aesthetics,  and  dramatics.  But  these  things  exist 
and  grow  only  because  of  the  industrial  foundation  upon 
which  they  rest. 

Deficiencies  of  Present-Day  Education 

An  education  that  neglects  the  senses,  the  motor  activities, 
and  the  technological  capacities  is  biased  and  unbalanced. 
Progressive  educators  have  long  noted  and  denounced  this  de- 
fect in  our  schools.  We  have  educated  for  leisure  rather  than 
life.  A  small  professional  class,  least  related  to  the  essentials 
of  society,  has  dominated  and  directed  the  curriculum.  The 
schools  were  apart  from  the  society  that  maintained  them  and 
for  which  they  were  supposed  to  prepare  their  pupils.  They 
neglected  the  life-career  motive  of  most  of  the  children.  They 
trained  those  who  must  carry  forward  society  industrially  for 
a  life  of  more  or  less  parasitic  idleness,  or  for  professions 
already  overcrowded  and  not  basically  essential  to  social  life. 
The  youth  in  such  schools  feels  himself  out  of  touch  with 
the  life  in  which  he  is  eager  to  bear  a  part.  He  leaves  the 


*  Thorstein  Veblen,  Instinct  of  Workmanship,  1914,  p.  103. 


TRAINING  143 

school  to  get  into  life.  Hence  the  rapid  falling  off  in  school 
attendance  noted  with  regret  by  every  observer.  Only  a 
minority  ever  reach  the  sixth  grade,  where  education  may  be 
said  to  begin.  All  before  that  is  merely  gaining  the  simplest 
and  most  essential  tools  with  which  an  education  is  to  be  built. 
Still  fewer  reach  the  high  school,  where  real  training  for 
industrial  life  should  be  received,  and  only  a  very  small  per- 
centage reach  the  university  and  receive  that  adequate  knowl- 
edge of  existing  standards  of  attainment  which  makes  easy 
further  invention. 

Education  for  Life  Work 

This  desertion  of  the  school  is  closely  related  to  one  of 
the  principal  causes  of  labor  turnover.  The  school  does  not 
offer  a  progressive,  permanent  development  of  a  life  career. 
Educators,  like  John  Dewey,  have  long  insisted  that  education 
should  be  for  life  and  through  life  and  in  life.  That  is,  it 
should  be  a  part  of  the  home,  the  shop,  the  state,  and  every 
other  phase  of  actual  life.  Especially  it  should  be  closely 
integrated  with  the  industrial  effort  by  which  the  pupil  must 
live.  It  should  continue  as  long  as  life  lasts  and  be  confined 
to  no  one  special  institution,  such  as  the  school.  Because  the 
school  of  the  present  inherited  the  monastic  traditions  and 
lived  apart  from  industry,  it  failed  to  reach  the  masses  or  to 
prepare  them  for  their  life  work. 

In  protest  against  this  there  has  been,  during  the  last 
decade,  a  remarkable  growth  of  technical,  vocational,  and 
industrial  education.  This  movement  has  reached  into  and 
is  transforming  the  courses  in  the  established  schools.  It  has 
led  to  the  development  of  night,  continuation,  correspondence, 
part-time  and  extension  schools.  In  the  case  of  the  so-called 
Gary  system  the  change  has  been  more  thoroughgoing.  The 
system  of  industrial  training  has  been  completely  integrated 
with  literary  training.  Management,  the  care  of  the  schools, 


144  PERSONNEL   RELATIONS   IN   INDUSTRY 

the  construction  of  apparatus,  and  the  amusements  of  the 
pupils  and  of  the  entire  neighborhood  are  made  a  part  of  the 
teaching  work.6 

Necessity  for  Plant  Training 

Until  the  Great  War  criticism  was  directed  almost  exclu- 
sively against  the  public  schools.  All  change  required  to  meet 
the  new  industrial  environment  was  expected  from  the  educa- 
tional institutions.  No  one  expected  the  industrial  environ- 
ment also  to  change.  The  school  was  to  come  to  the  factory, 
not  the  factory  to  the  school.  The  crying  need  for  skilled 
workers  in  the  war,  and  in  the  international  competition  fol- 
lowing war,  has  led  to  a  phenomenal  development  of  factory 
training.  In  this  process  both  schoolman  and  industrial  man- 
ager are  being  educated  and  school  and  factory  are  alike  trans- 
formed. 

An  adequate  training  system  makes  a  plant  a  place  for 
continuous  growth  and  development.  It  corrects  mistakes  in 
adjustment  with  a  minimum  of  lost  time  and  opportunity. 
It  makes  possible  a  proper  utilization  of  all  human  material. 
It  also  enables  that  human  material  to  utilize  its  opportunities 
to  its  greatest  advantage  and  enjoyment. 

Every  plant  has  some  sort  of  training  always  in  progress. 
Some  managers  may  deny  this,  which  only  means  that  the 
training  is  unconscious,  unorganized,  useless,  and  wasteful. 
Training  by  "picking  up  a  trade"  wastes  the  worker's  time, 
the  employer's  resources,  and  the  product  of  the  industry. 
It  results  in  drifting,  slyness,  and  superficiality,  and  graduates 
an  army  of  wandering  unemployed  that  drag  down  wages 
and  handicap  industry.  H.  L.  Gantt,  thus  characterizes  this 

policy : T 

I 

*  R.  S.  Bourne,  The  Gary  Schools,  1916,  especially  Chapter  III. 
TH.   L.    Gantt,    Organizing   for   Work,    1919,   pp.   88,   89.     Italics   in 
original. 


TRAINING  145 

Many  of  our  large  industrial  concerns  have  estimated 
that  the  cost  of  breaking  in  a  new  employee  is  very  high — 
running  from  about  $35.00  up.  We  have  already  satisfied 
ourselves  that  if  only  a  fraction  of  this  amount  is  expended 
in  training  the  inferior  workman,  we  can  reduce  migration 
very  materially.  In  other  words,  money  spent  in  proper 
teaching  and  training  of  workmen  is  a  highly  profitable 
investment  for  any  industrial  concern,  provided  there  is 
some  means  of  measuring  and  recording  the  result.  So 
beneficial  have  our  training  methods  proved  that  we  are 
inclined  to  believe  that  the  practice  of  stealing  good  work- 
men from  one's  competitors  will  ultimately  prove  to  be  as 
unprofitable  as  stealing  his  property. 

Before  the  rise  of  modern  industry  the  world  was  con- 
trolled largely  by  predatory  nations  who  held  their  own 
by  exploiting  and  taking  by  force  of  arms  from  their  less 
powerful  neighbors.  With  the  rise  of  modern  industrialism, 
productive  capacity  has  been  proven  so  much  stronger  than 
military  power  that  we  believe  the  last  grand  scale  attempt 
to  practice  the  latter  method  of  attaining  wealth  or  power 
has  been  made.  In  this  great  war  it  was  clearly  proven 
that  not  what  we  have,  but  what  we  can  do  is  the  more 
important.  It  clearly  follows,  then,  that  the  workers  we 
have  are  not  so  important  as  our  ability  to  train  others; 
again  illustrating  the  fact  that  our  productive  capacity  is 
more  important  than  our  possessions. 

Character  of  Plant  Training 

The  character  of  the  training  which  any  plant  should 
introduce  must  depend  upon  the  work  to  be  done.  This 
involves  the  character  of  the  employees  and  the  industry,  as 
well  as  the  condition  of  the  educational  institutions  in  the 
neighborhood.  The  fundamentals  should  be  acquired  outside 
the  plant,  though  sometimes  this  cannot  be  done.  Even  then 
no  plant  can  afford  long  to  employ  anyone  who  cannot  read 
and  speak  the  English  language.  If  facilities  for  such  elemen- 
tary education  are  not  afforded  by  public  authorities  the  firm 
will  find  it  profitable  to  supply  them.  Employees  who  cannot 


146  PERSONNEL   RELATIONS   IN   INDUSTRY 

read  safety  notices  or  instructions,  or  understand  orders  in 
a  language  common  to  the  shop,  who  can  work  only  under 
foremen  of  a  certain  nationality  and  are  incapable  of  sharing 
in  the  common  mind  of  the  plant,  are  extremely  inefficient. 

When  the  schools  have  in  any  adequate  degree  risen  to 
their  duties  and  opportunities,  shop  training  should  be  con- 
fined to  information  largely  peculiar  to  the  plant  and  neces- 
sary for  a  specific  promotion  or  job.  Such  education  is  a 
great  force  making  for  permanence.  Every  analysis  of  turn- 
over shows  the  greatest  percentage  of  change  among  the 
unskilled  and  the  young.  By  training,  the  unskilled  can  be 
transformed  into  skilled.  During  the  training  period  they 
are  held  by  the  prospect  of  growth  in  skill  and  in  income. 
After  that,  the  possession  of  a  skilled  job,  together  with  the 
possibility  of  promotion,  removes  the  incentive  to  change. 

Training  Younger  Workers 

Much  the  same  effect  is  produced  by  training  younger 
workers.  A  certain  amount  of  drifting  is,  for  the  young, 
desirable.  They  should  not  settle  down  until  sure  that  the 
right  vocation  has  been  chosen.  Until  a  proper  system  of 
vocational  education  and  guidance  exists,  the  necessary  com- 
parison of  jobs  can  be  made  only  by  moving  from  plant  to 
plant.  Regular  training  classes,  with  opportunity  for  learning 
and  growth,  greatly  reduce  the  turnover  among  the  young. 
The  proper  place  for  such  training  is,  nevertheless,  in  some 
modified  form  of  the  public  schools,  where  guidance  can  be 
impartial  and  education  will  not  be  sacrificed  to  profits.  Only 
with  adults,  capable  of  protecting  their  own  interests,  can 
training  be  safely  entrusted  to  unsupervised  private  firms. 

Training  Adults 

For  such  adults  there  is  a  great  and  growing  field  of 
training.  Progressive  firms  are  everywhere  establishing  train- 


TRAINING  147 

ing  departments,  sometimes  functionalizing  a  section  of  the 
plant  for  the  purpose,  and  again  mingling  production  and 
education  from  the  beginning.8  The  general  direction  of  a 
training  department  should  be  part  of  the  work  of  a  director 
of  personnel  relations.  His  work  is  intimately  connected  with 
problems  of  promotion,  transfers,  and  standards  of  produc- 
tion. Employees  must  be  assigned  to  the  training  depart- 
ment upon  the  basis  of  the  reports  and  records  in  the  per- 
sonnel department.  Conversely,  reports  of  training  results 
would  determine  much  of  the  work  of  the  personnel  depart- 
ment. Such  a  system  establishes  continuous  vocational  train- 
ing. It  insures  growth  throughout  a  lifetime.  There  is  no 
greater  insurance  against  premature  old  age.  Furthermore, 
it  permits  the  adjustment  of  all  industrial  demands,  giving 
each  worker  a  choice  of  occupations  and  providing  that 
element  of  change  which  satisfies  the  instinct  of  adventure 
and  wandering. 

Organization  of  Training  System 

The  pedagogy  and  organization  of  a  plant  training  system 
must  be  different  frorrvthat  of  the  schools.  The  main  decisions 
as  to  a  life  career  will,  in  most  cases,  have  been  made.  Train- 
ing must  be  related  to  production.  It  must  build  upon  the 
cultural  education  of  the  schools.  It  must  be  able  to  present 
its  cost  sheets  and  its  report  of  results,  and  these  must  accord 
with  its  forecasts.  Plant  training  is  usually  for  a  definite 
position,  previously  decided  upon.  Methods  of  doing  these 
things  have  been  scientifically  determined,  and  it  is  possible 
to  submit  specifications  as  to  cost,  time,  and  equipment  required 
to  transform  any  given  block  of  workers  possessed  of  certain 
qualifications  into  workers  capable  of  filling  higher  positions. 


*C.  R.  Allen,  The  Instructor,  the  Man  and  the  Job,  1919,  is  a  full  and 
excellent  treatment  of  all  phases  of  shop  training.  It  should  be  consulted 
by  those  who  wish  to  follow  further  the  subjects  touched  upon  in  the  text. 


148  PERSONNEL   RELATIONS    IN   INDUSTRY 

The  personnel  director  must  unite  plant  training  with  all 
outside  means  of  instruction.  His  office  must  be  a  reference 
department  on  educational  facilities  which  should  be  known 
and  used.  He  should  be  familiar  with  the  desires,  capacities, 
and  ambitions  of  every  worker  and  be  able  to  advise  each 
one  what  form  of  education  will  best  further  his  special 
progress.  This  means  a  well-classified  and  complete  collection 
of  information  on  the  literature  of  the  various  trades  in  the 
plant  and  the  instruction  offered  by  all  educational  institutions, 
public  and  private.  This  sounds  encyclopedic  and  imprac- 
ticable, but  such  matter  is  in  great  measure  already  classified 
and  easily  accessible.  Full  use  of  such  information  permits 
a  proper  adjustment  of  plant  training  to  that  of  outside  institu- 
tions, with  a  full  utilization  of  the  possibilities  of  the  latter.' 

The  Foreman's  Place  in  the  Training  Scheme 

The  transformation  of  a  factory  or  other  industrial  plant 
into  an  educational  institution,  even  to  the  extent  demanded 
by  a  proper  and  profitable  training  system,  brings  with  it 
great  and  fundamental  changes.  It  calls  for  a  new  type  of 
foreman.  Here  we  touch  upon  one  of  the  weakest  links  in 
the  improvement  of  personnel  relations.  Advocates  of  im- 
proved methods  in  management  are  apt  to  confine  their  ener- 
gies to  selling  their  plans  to  the  higher  officials,  and  then  to 
persuading  the  rank  and  file  to  consent  to  their  adoption;  the 
foreman  is  forgotten.  More  than  once,  in  teaching  classes  in 
personnel  relations,  I  have  had  foremen  who  were  pupils  say, 
with  regard  to  some  suggested  method,  "I  think  we  have 
something  like  that  in  our  plant.  I  have  heard  the  men  talk 

'"First,  the  primary  aim  of  the  educational  work  carried  on  with  an 
industrial  organization  is  to  train  employees  for  immediate  usefulness 
within  the  organization  itself.  Secondly,  the  more  general  forms  of 
education  can  be  better  carried  on  and,  from  every  point  of  view,  should 
be  conducted  by  the  community  rather  than  private  enterprise." — H.  C. 
Link,  Employment  Psychology,  1919,  p.  173. 


TRAINING  149 

about  it,  but  nobody  ever  said  anything  to  me  about  it."  In 
every  instance,  the  method  in  question  required  intelligent  and 
enthusiastic  support  from  the  foremen  to  assure  success. 

Training  on  the  job,  even  though  very  properly  supple- 
mented by  functionalized  training  departments,  or  introduced 
by  vestibule  schools,  demands  that  the  foreman  should  be 
primarily  a  teacher.  If  he  is  to  act  as  instructor  he  must  be 
given  wider  knowledge,  responsibility,  and  dignity.  The 
gradual  recognition  of  this  fact  has  given  rise  to  the  beginning 
of  what  are  growing  into  elaborate  courses  especially  designed 
for  the  training  of  foremen.10 

The  foremen  of  the  future  will  be  very  different  from 
the  foremen  of  the  present.  A  different  type  of  men  will 
be  selected,  less  of  pure  drivers  but  men  who  combine  di- 
plomacy and  a  broad  understanding  of  human  nature  with 
the  faculty  of  getting  things  done.  The  character  of  fore- 
men is  also  largely  determined  by  the  traditions  and  ideals 
of  the  organization.  The  traditions  and  ideals  of  the  busi- 
ness organizations  of  the  future  will  be  decidedly  more  lib- 
eral than  those  of  the  business  organizations  of  the  pres- 
ent. The  future  foremen's  attitude  and  point  of  view  will 
also  be  moulded  by  definite  training  received  before  they 
assume  their  duties.  Finally  the  foremen  will  owe  their 
promotion  largely  to  the  supervisor  of  labor  and  will  be 
assisted  by  him  in  learning  the  ropes  during  their  first  few 
weeks  on  the  job.  Consequently  they  will  be  much  more 
amenable  than  are  foremen  of  the  present  to  advice  and 
criticism  from  the  labor  supervisor.11 


'"The  foreman's  education  has  been  sadly  neglected  and  yet  he  is 
the  man,  and  the  only  man  in  authority,  who  makes  contact  with  our 
workmen  through  a  naif  of  their  working  hours.  .  .  .  No  ideas  are  of 
lasting  benefit  to  any  plant  unless  they  are  well  sold  to  the  foremen,  and 
orfly  a  mere  fraction  of  the  present  day  literature  on  how  to  analyze  and 
handle  the  human  factors  in  industry  is  intelligible  to  the  foreman  who 
must  do  this  work  in  detail." — John  Calder,  former  president  Remington 
Typewriter  Company,  in  Iron  Trade  Review,  Apr.  17,  1919,  p.  1030. 

11  S.  H.  Slichter,  Turnover  of  Factory  Labor,  1919,  p.  385. 


15°  PERSONNEL  RELATIONS   IN  INDUSTRY 

The  technical  education  of  the  foreman  will  come  largely 
prior  to  promotion  to  his  position.  Then  should  follow  train- 
ing in  a  more  scientific  knowledge  of  human  nature.  He 
should  know  the  methods  of  appealing  to  the  fundamental 
instincts  of  those  with  whom  he  must  deal.  He  should  be 
familiar  with  systems  of  routing,  planning,  and  handling  of 
materials,  and  should  share  in  the  fixing  of  such  systems. 
He  should  know  the  plans  of  promotion  and  the  ambitions 
of  the  workers  whom  he  directs.  He  must  be  constantly  con- 
sulted by  the  head  of  the  personnel  relations  department  on 
these  and  all  other  points  concerning  the  movements  and  con- 
trol of  persons. 

Training  Conferences  for  Foremen 

Such  training  of  foremen  can  be  done  largely  by  the  con- 
ference method.  This  is  simply  the  seminar  method  of  the 
universities  in  working  clothes.  Someone  leads  the  confer- 
ence, but  he  does  not  monopolize  the  teaching.  Each  person 
is  teacher  in  turn  to  the  extent  of  his  abilities.  Ideas  are 
subjected  to  mutual  analysis,  criticism,  and  development.  It 
is  important  that  such  conferences  be  kept  upon  this  high  and 
democratic  seminar  standard  and  do  not  degenerate  into  meet- 
ings where  executives  give  orders.12 

Such  conferences  should  also  be  the  normal  schools  of 
the  industry,  training  the  foremen  in  methods  of  teaching 
as  well  as  managing.  It  should  never  be  forgotten  that  pro- 

3  "Should  the  chief  officials  use  the  conference  in  the  main  for  pur- 
poses of  announcing  what  they  had  already  decided  upon  or  should  the 
conferees,  having  authority  only  to  recommend,  enforcement  being  left 
to  others  at  the  latter's  discretion,  discover  that  as  a  matter  of  record  the 
recommendations  submitted  were  being  rejected  without  due  grounds,  the 
conference  likely  will  not  evoke  any  particular  feeling  of  enthusiasm  or 
responsibility.  Those  concerns  which  are  using  the  conference  system 
most  effectively  do  not  permit  higher  officials  to  make  of  it  an  empty 
shell,  some  of  them  going  to  great  lengths  in  assuring  the  conferee  of  his 
responsibility." — E.  B.  Gowin,  The  Selection  and  Training  of  the  Business 
Executive,  1918,  p.  139. 


TRAINING  IS1 

duction  is  one  trade  and  teaching  is  another,  and  the  foreman 
with  technical  skill  at  a  trade  and  even  tact  and  ability  in 
handling  workers,  is  not  always  capable  of  teaching  others 
what  he  knows.  The  transformation  of  foremen  into  teachers, 
or  at  least  the  addition  of  the  teaching  function  to  their  other 
duties,  is  directly  in  accord  with  the  best  practice  of  scientific 
production  management.  One  of  the  fundamental  principles 
of  such  management  is  the  use  of  "functional  foremen  as 
teachers  instead  of  drivers.  Such  foremen  are  specialists  in 
various  phases  of  the  work.  As  they  have  an  opportunity 
for  education  and  experience  in  their  special  lines  they  become 
in  the  nature  of  individual  expert  advisers,  teaching  the  work- 
man the  higher  aspects  of  his  craft."  13 

There  is  an  opportunity  for  'training  in  the  preparation 
of  such  careful,  detailed  orders  as  scientific  management  calls 
for.  Standardized  orders,  fully  written  out  and  accompanied 
by  drawings  and  detailed  instructions,  can  be  made  valuable 
textbooks  for  special  operations  and  used  for  the  education 
of  the  workers.1* 

Possibilities  of  Industrial  Training 

Education  in  and  through  industry  has  no  limits  of  age 
or  degree.  The  existence  of  research  departments  and  labora- 
tories, and  especially  their  organized  co-operation  with  educa- 
tional institutions  in  such  work,  opens  a  field  of  training  and 


u  F.  B.  Gilbreth,  Applied  Motion  Study,  1917,  p.  23.  In  this  connection 
see  also  Hugo  Diemer,  Industrial  Organization  and  Management,  1915, 
pp.  7,  8.  Federal  Board  for  Vocational  Education,  Foreman  Training 
Courses,  Bulletin  No.  36,  discusses  importance  of  and  gives  outline  of 
training  course  for  foremen. 

14  E.  D.  Jones,  Administration  of  Industrial  Enterprises,  1916,  p.  130; 
F.  A.  Parkhurst,  Applied  Methods  of  Scientific  Management,  1917,  pp. 
118-119.  The  latter  gives  methods  by  which  such  orders  are  prepared 
and  used  in  the  Ferracute  Machine  Company's  Works ;  R.  W.  Kelly, 
Training  Industrial  Workers,  1920,  Appendix  F,  pp.  376,  377,  gives  an 
extract  from  the  standard  practice  sheet  of  the  Hood  Rubber  Company, 
which  is  prepared  with  a  view  to  educational  purposes. 


IS2  PERSONNEL  RELATIONS   IN  INDUSTRY 

experience  in  original  research  of  the  highest  grade.  The 
Mellon  Institute  of  the  University  of  Pittsburgh  has  arrange- 
ments by  which  any  firm  can  endow  a  fellowship  for  original 
research  upon  any  problem  in  whose  solution  the  industry 
is  interested.  Such  a  fellow  has  access  to  all  the  resources 
of  the  university,  including  the  expert  advice  of  members  of 
the  faculty.  The  Massachusetts  Institute  of  Technology  has 
carried  such  co-operation  still  further  in  the  plans  for  its 
recent  endowment.  Firms  giving  a  certain  sum  to  this  endow- 
ment are  entitled  to  the  use  of  the  libraries,  laboratories,  and 
all  research  facilities  of  this  great  institute.  The  sum  required 
is,  of  course,  very  many  times  less  than  would  be  required 
to  purchase  and  maintain  a  private  research  department  with 
much  poorer  facilities.  Firms  with  such  connections  can  pro- 
vide for  the  very  highest  training  for  any  of  their  personnel, 
thus  making  education  in  connection  with  industry  as  bound- 
less as  the  educational  facilities  of  the  age  afford. 

Effect  on  Labor  and  Production 

A  thoroughgoing  system  of  plant  training,  reaching  from 
the  bare  removal  of  illiteracy  to  the  highest  phases  of  original 
research,  embracing  all  grades  of  labor,  and  using  every  educa- 
tional resource,  public  and  private,  implies  a  transformation 
of  the  industrial  process  into  something  much  like  the  ideal 
of  the  greatest  educators.  Such  a  system  of  training  will 
bring  with  it  fundamental  changes  in  the  whole  industrial 
structure.  Dr.  Lee  Galloway  suggested  some  of  these  in  an 
address  before  the  Seventh  Annual  Conference  of  the  National 
Association  of  Corporation  Schools,  when  he  said: 

Training,  however,  touches  the  very  heart  of  employee 
relations  of  every  kind.  .  .  .  Training  creates  greater  effi- 
ciency, but  it  also  stimulates  ambition  for  promotion;  train- 
ing develops  the  employee's  interest  in  his  work,  but  it 
also  awakens  a  desire  to  know  the  next  job  as  well;  train- 


TRAINING  153 

ing  creates  the  spirit  to  investigate  one's  own  job,  but  it 
also  awakens  a  curiosity  concerning  the  balance  sheet; 
training  promotes  loyalty  to  the  firm,  but  it  likewise  stimu- 
lates a  patriotic  prejudice  against  unjust  usurpation  of  the 
best  positions  by  unworthy  persons ;  training  develops 
greater  skill,  but  at  the  same  time  it  opens  the  employee's 
mind  to  any  disparity  between  his  own  growing  capacity 
and  that  of  his  boss;  training  increases  the  employee's  ap- 
preciation of  his  employer's  efforts  to  promote  the  welfare 
of  the  organization,  but  it  induces  him  also  to  measure  his 
own  influence  in  the  determination  of  affairs  (no  matter 
how  trivial)  against  the  arbitrary  demands  of  his  superior. 
In  short,  where  one  sets  out  to  liberate  power  he  must  pro- 
vide the  means  for  its  control  and  direction. 

Training  makes  possible  a  rapid  and  unlimited  increase 
in  production.  Greater  knowledge  gives  greater  productive 
power.  No  improvements  effect  so  continuous  an  increase 
in  that  control  over  nature  which  is  the  essence  of  industry 
as  improvements  in  the  mental  equipment  of  those  concerned. 
Such  increased  production  is  the  only  means  by  which  all  can 
rise.  Such  rising  need  not  be  by  competitive  crowding  out 
of  an  ever-decreasing  number  as  the  top  is  reached.  Each 
one  rises  by  virtue  of  an  increasing  share  in  a  growing 
product. 

Effect  on  Mental  Ability 

Training  is  another  method  of  meeting,  and  at  least  alle- 
viating, some  phases  of  monotony  in  work.  A  monotonous 
task  which  is  recognized  as  a  stepping-stone  to  something 
more  interesting,  remunerative,  and  otherwise  desirable,  loses 
much  of  its  monotony.  Moreover,  even  an  active  mind  tem- 
porarily directing  such  a  task,  if  filled  with  material  for  men- 
tal exercise,  is  much  less  distressed  by  its  monotony. 

It   is  a  commonplace  that  the  mastery   of  skill   in   the 
form  of  established  habits  frees  the  mind  for  a  higher  order 


154  PERSONNEL   RELATIONS   IN   INDUSTRY 

of  thinking.  Something  of  the  same  kind  is  true  of  the 
introduction  of  mechanically  automatic  operations  in  indus- 
try. They  may  release  the  mind  for  thought  upon  other 
topics.  But  when  we  confine  the  education  of  those  who 
work  with  their  hands  to  a  few  years  of  schooling  devoted 
for  the  most  part  to  acquiring  the  use  of  rudimentary  sym- 
bols at  the  expense  of  training  in  science,  literature  and 
history,  we  fail  to  prepare  the  minds  of  workers  to  take 
advantage  of  this  opportunity.15 

Training  makes  the  entire  plant  one  vast  "suggestion  box" 
and  hotbed  for  the  incubation  of  ideas  to  fill  the  box.  The 
reason  for  the  almost  universal  rapid  fizzling  out  of  the  sug- 
gestion-box idea  in  most  industries,  in  spite  of  the  awarding 
of  bonuses  and  prizes  to  inspire  interest,  should  have  been 
evident  to  even  a  tyro  in  mental  mathematics.  When  four 
i's  have  been  taken  from  4,  only  zero  remains.  When  the 
minds  of  the  workers  have  been  emptied  of  their  original 
content,  ideas  are  not  readily  produced  by  means  of  bonuses. 
In  fact,  bonuses  and  prizes  are  poor,  but  perhaps  at  present 
necessary,  means  of  cultivating  industrial  ability.  They  appeal 
to  wholly  different  instincts  from  that  of  workmanship,  which 
is  the  one  that  must  be  gratified  if  inventions  are  to  come. 

A  full  knowledge  on  the  part  of  the  workers  of  the  scien- 
tific laws  back  of  their  work,  together  with  the  constant  in- 
spiration derived  from  a  vitalized  training  system,  will  fill 
the  workers'  minds  with  ideas  clamoring  for  expression.  A 
training  department  that  permeates  the  entire  plant  organiza- 
tion, everywhere  bringing  opportunity  for  choice  in  occupa- 
tion and  growth  in  skill  and  income,  lays  the  foundation  of 
plant  solidarity  such  as  is  obtainable  in  no  other  way.  A  group 
thus  growing,  studying,  discovering,  and  working  together, 
when  democratically  directed,  possesses  an  esprit  de  corps  that 
increases  and  deepens  with  every  co-operative  achievement. 


"John  Dcwey,  Democracy  and  Education,  1916,  p.  304. 


CHAPTER  X 

ADJUSTMENTS,    TRANSFERS,     PROMOTIONS, 
DISCHARGE 

Basing  Adjustments  on  Records 

Adjustments  of  personnel  within  an  industry  depend  for 
success  or  failure  largely  upon  the  accuracy  and  adequacy 
of  the  records.  Such  internal  adjustments  constitute  con- 
tinuous selection  and  should  be  based  upon  a  continuous  and 
constantly  improving  job  analysis.  There  should  be  standards 
of  judgment  and  promotion,  known  to  all  and  subject  to 
sharp  criticism  to  insure  impartiality.  No  changes  should 
be  made  because  of  nepotism,  favoritism,  and  office  politics. 
Until  standards  of  perfection  far  beyond  those  now  existing 
are  attained,  changes  will  be  made  for  just  these  reasons. 
Other  standards,  though  universally  approved,  will  be  slow 
of  establishment.  It  could  not  be  otherwise,  for  even  though 
an  honest  effort  is  made  to  avoid  such  influence,  we  always 
have  kindlier  feelings  toward  those  of  our  own  race,  church, 
club,  family,  or  clique.  These  feelings  will  lead  us  to  see 
virtues  and  be  blind  to  faults;  and  only  a  clearly  functioning 
machinery  of  records,  rating,  and  promotion  planning  will 
hold  this  tendency  in  check. 

Elements  Involved  in  Transfers  and  Promotions 

Every  transfer  within  the  plant  involves  three  elements: 
two  positions  and  the  person.  Intelligent  handling  of  the 
situation  requires  accurate  knowledge  of  the  position  from 
which  the  employee  is  taken,  the  one  to  which  he  is  to  be 
transferred,  and  the  qualifications  of  the  employee.  The  treat- 

155 


I56  PERSONNEL   RELATIONS   IN   INDUSTRY 

ment  of  transfers  and  promotions  within  the  plant  was 
recently  considered  by  a  committee  of  the  Chicago  Council 
of  the  National  Employment  Managers  Association.  The 
report  of  this  committee,  of  which  H.  C.  Hobart,  employment 
manager  for  Albaugh,  Dover  and  Company,  was  the  chair- 
man, is  one  of  the  best  discussions  of  the  subject.  The  follow- 
ing quotations  are  taken  from  that  report:  * 

The  truly  scientific  basis  for  the  transfer  and  promo- 
tion of  employees  is  absolute  knowledge  regarding  every 
position  in  the  organization — the  positions  from  which  a  man 
may  be  taken  to  fill  a  given  position  and  the  positions 
to  which  a  given  position  may  lead.  In  addition  to  this  in- 
formation there  must  be  a  definite  knowledge  of  the  physical 
and  temperamental  characteristics  required  in  a  person  who 
is  to  fill  a  given  position.  Separating  these  two  ideas,  there 
must  be  a  standardization  of  duties,  a  classification  of  posi- 
tions, and  a  standardization  of  requirements — a  job  analysis. 

The  first  step  in  the  classification  of  positions  is  that 
in  which  all  positions  having  identical  or  very  similar  duties 
requiring  the  same  degree  and  kind  of  skill,  special  knowl- 
edge or  responsibility,  are  given  the  same  name  or  classifica- 
tion title  and  are  grouped  together  in  one  grade. 

The  grades  having  been  established  are  then  grouped 
into  two  classes,  grades  having  certain  characteristics  in 
common  being  assigned  to  the  same  class. 


The  purpose  is  still  further  served  by  listing  after  each 
grade  the  grades  from  which  and  the  grades  to  which 
promotion  and  transfer  may  be  made. 


In  addition  to  affording  a  basis  for  a  definite  and  equi- 
table promotion  system,  such  classification  will  afford  a  basis 
for  the  formation'  of  a  scientific  wage  schedule,  and  will 
afford  a  uniform  nomenclature  for  all  employment  reports, 
records,  etc. 


1  Report  Transfer  and  Promotion  Commission  of  Chicago  Council, 
National  Employment  Managers  Association-,  Iron  Age,  June  5,  1919,  pp. 
1518,  1519.  See  N.  W.  Shefferman,  Employment  Methods,  pp.  227,  228. 


ADJUSTMENTS,    PROMOTIONS,    DISCHARGE  1 57 

All  transfers  should  be  made  through  the  employment 
department.  A  foreman  or  department  head  who  desires  to 
obtain  a  particular  worker  from  another  department  should 
make  application  for  this  change  to  the  employment  depart- 
ment, which  will  arrange  for  the  transfer  if  it  is  pos- 
sible. .  .  . 

To  properly  take  care  of  promotion  and  transfer  in  a 
large  organization  it  is  advisable  to  have  an  up-to-date  list 
of  eligibles  for  every  position.  This  list  may  take  the  form 
of  a  card  index,  a  loose-leaf  folder,  or  a  modification  of  the 
system  used  by  the  government  at  cantonments.  One  firm 
has  adapted  this  system  to  its  use  very  readily.  The  record 
card  and  application  of  each  employee,  together  with  other 
information,  are  filed  in  a  letter-size  manilla  envelope,  the 
top  of  this  envelope  is  divided  into  35  or  so  spaces,  each 
position  representing  an  occupation  in  the  company's  shop. 
Each  such  space  representing  an  occupation  in  which  that 
particular  employee  has  had  experience  is  marked  on  the 
edge  of  the  envelope  with  a  V-shaped  punch  mark.  When 
the  envelopes  of  all  the  employees  are  standing  upright  in 
their  file  all  punch  marks  in  any  particular  horizontal  line 
down  the  file  indicate  employees  with  experience  in  the  same 
kind  of  work. 


Rating  Employees  for  Promotion 

Certain  standards  of  practice  are  necessary  to  approximate 
fairness  and  accuracy  in  rating  employees  for  promotion.  The 
rating  should  be  the  judgment  of  more  than  one  person.  It 
should  rest  on  standards  of  judgment  and  should  embrace  an 
established  list  of  qualities.  It  should  be  determined  by 
estimates  made  at  various  times,  so  as  to  avoid  temporary 
influences  of  prejudice  on  the  part  of  the  judge  or  temporary 
spurts  by  the  employee.  Observance  of  these  rules  removes 
the  elements  of  personal  favoritism  or  the  reverse,  and  of 
momentary  impressions,  as  completely  as  it  is  humanly  pos- 
sible to  remove  them. 

The  most  systematic  effort  to  meet  these  qualifications  was 


I58  PERSONNEL   RELATIONS   IN   INDUSTRY 

made  in  the  rating  of  officers  in  the  national  army.2  Although 
the  qualities  which  the  army  scale  aimed  to  measure  are  not 
wholly  the  same  as  those  sought  for  in  industry,  the  method 
used  in  preparing  and  applying  the  scale  is  suggestive  of 
similar  work  in  promoting  and  transferring  workers. 

It  was  recognized  that  there  is  really  no  way  to  measure 
human  nature  or  the  qualities  that  compose  it.  All  we  can 
do,  as  already  shown  in  discussing  tests  for  intelligence,8  is 
to  create  a  standard  scale  for  the  comparison  of  various  per- 
sons. Moreover,  a  different  scale  must  be  made  for  each 
quality.  Therefore  the  person  preparing  the  scale  is  asked 
to  write  down  the  names  of  a  dozen  persons  with  whose 
qualifications  he  is  most  familiar.  He  then  arranges  them 
in  the  order  of  their  merit  with  regard  to  one,  and  only  one, 
quality.  This  arrangement  is  made  by  selecting  the  best  one 
and  the  worst  one  first,  then  the  one  who  seems  half-way 
between ;  the  others  are  placed  one  by  one  in  the  same  manner. 
The  reason  for  this  method  is  to  insure  isolated  consideration 
of  a  single  quality  at  a  time.  This  scale  of  actual  persons 
is  then  used  as  a  means  of  measuring  the  person  to  be  rated, 
who  is  given  the  grade  of  the  person  upon  the  scale  whom 
he  most  resembles  in  regard  to  the  quality  to  be  measured. 

A  similar  scale  is  made  in  the  same  way  for  each  other 
quality.  The  person  to  be  judged  is  measured  for  each  quality 
separately  by  the  scale  prepared  for  that  particular  quality. 
He  is  given  the  number  of  points  originally  assigned  to  the 
person  whom  he  most  closely  resembles  in  regard  to  the 
quality  under  consideration.  The  sum  total  of  points  gives 
the  person's  total  rating.  There  are  detailed  instructions  as 
to  the  elements  which  are  to  be  considered  in  rating  any  given 


'Personnel  System  of  the  United  States  Army,  1919,  Vol.  II,  pp. 
252-274;  Bloomfield,  Selected  Articles  on  Employment  Management,  1919, 
pp.  213-222. 

1  See  p.  84. 


ADJUSTMENTS,    PROMOTIONS,    DISCHARGE  159 

quality.  As  a  result  it  has  been  found  that  a  large  number 
of  persons  using  this  method  will  all  rate  the  same  men  at 
about  the  same  point.* 

Simplified  System  of  Rating 

A  simplified  system  is  used  in  the  armory  at  Springfield, 
Massachusetts.  The  following  five  qualifications  are  con- 
sidered and  weighted  according  to  the  numbers  given :  attend- 
ance i ;  application  i ;  habits  2 ;  adaptability  2 ;  ability  4.  The 
ratings  are  made  every  six  months  by  a  board  consisting  of 
the  officer  in  charge,  the  assistant  officer,  general  foreman, 
assistant  foreman  in  charge  of  the  workman's  department, 
and  the  chief  inspector.  In  practice  it  has  been  found  difficult 
to  fix  any  standards  of  habits  and  application,  and  conse- 
quently unless  definite  evidence  is  offered  on  these  points  the 
men  are  given  full  credit.5  This  difficulty  in  measuring  char- 
acter elements  is  in  accord  with  what  has  already  been  stated 
and  suggests  that  such  items  should  be  omitted  from  rating 
records  as  well  as  from  application  blanks.  Rating  by  several 
persons  insures  much  greater  care  on  the  part  of  each  one, 
as  also  do  repeated  ratings  at  regular  intervals.  Each  judge 
knows  that  his  estimate  will  be  checked  by  that  of  others  and 
also  by  his  own  estimate  at  a  later  date.  Such  conditions, 
with  the  requirement  that  each  quality  be  checked  separately, 
and  that  certain  definite  elements  always  be  kept  in  mind  in 
estimating  a  quality,  place  a  strong  check  on  prejudice  and 
snap  judgment. 


*  Bloomfield's  Selected  Articles  on  Employment  Management,  1919,  pp. 
220,  221,  gives  an  effort  to  construct  a  similar  blank  for  foremen  in 
industry;  N.  W.  Shefferman,  Employment  Methods,  1920,  pp.  316-319; 
R.  W.  Kelly,  Training  Industrial  Workers,  1920,  Chaps.  XV  and  XVI, 
give  samples  of  various  forms  of  rating  scales  and  discuss  methods 
of  rating  and  promotion. 

BM.  T.  Copeland,  Business  Statistics — The  Automatic  Rating  of 
Workmen,  1912,  pp.  425-427;  also  in  Iron  Age,  Apr.  3,  1914,  pp.  8n,  812; 
S.  H.  Slichter,  The  Turnover  of  Factory  Labor,  1919,  p.  363. 


l6o  PERSONNEL   RELATIONS   IN   INDUSTRY 

Checking  Ratings 

Any  system  of  rating  should  also  be  checked  by  the  use 
of  intelligence  and  trade  tests.  Such  use  in  transfers  within 
the  plant  offers  an  opportunity  for  testing  and  developing 
the  tests.  All  educational  work  done  by  employees  should 
find  a  place  upon  the  records  that  guide  promotion  and  be 
given  weight  in  determining  rating.  Finally,  production 
records  should  be  basic  to  all  rating  systems,  but  such  records 
are  only  of  value  when  they  are  based  on  time  and  motion 
studies  and  standardized  factory  conditions.  Otherwise  the 
factors  of  production  are  not  under  the  control  of  the  worker 
and  he,  cannot  justly  be  held  responsible  for  his  rate  of  pro- 
duction.1 

When  the  factors  to  be  used  as  the  basis  of  a  rating  system 
have  been  standardized  and  rules  established  for  their  estima- 
tion, these  standards  should  be  embodied  in  record  blanks, 
with  rules  for  their  regular  use.  Such  a  blank  with  suggested 
qualities  is  given  by  Henry  C.  Link  in  his  "Employment 
Psychology,"  and  is  here  reproduced:  e 

Name Location 

Opposite  each  quality  enter  either  number  i,  2,  3,  or  4,  according 
as  you  consider  the  worker  named  in  the  ist,  2nd,  3rd,  or  4th  class 
in  respect  to  that  particular  quality. 

1.  Attendance 

2.  Industry 

3.  Intelligence 

4.  Speed 

5.  Initiative 

6.  Tact Estimate  made  by 

7.  Executive  Ability 

8.  Orderliness 

9.  Personal  Habits 

10.  Reliability Date 

Total 

% 

*H.  C.  Link,  Employment  Psychology,  1919,  p.  328. 


ADJUSTMENTS,    PROMOTIONS,   DISCHARGE  l6l 

Thorough  training  of  foremen  in  the  use  of  such  a  blank 
reduces  the  time  required  for  checking  to  a  few  seconds  for 
each  worker.  The  real  judging  will  have  been  done  in  the  days 
before  the  blank  is  to  be  marked. 

Location  and  Use  of  Records 

Even  the  best  of  records  are  not  automatic.  The  most 
careful  ratings  have  a  tendency  to  get  lost  in  the  files  and 
thereby  lose  their  relation  to  the  actual  movements  of  men 
in  the  shop.  There  must,  therefore,  be  some  method  to  insure 
periodic  examinations  and  action  upon  the  information. 
Modern  employment  practice  makes  all  changes  through  the 
central  personnel  department.  The  proper  records  "can  be 
found  only  there.  No  other  department  can  have  the  neces- 
sary general  oversight  of  the  entire  industry.  But  changes 
should  be  made  only  after  full  consultation  with  and  consent 
of  the  foremen  involved. 

Basis  of  Transfers  and  Promotions 

Transfers  from  department  to  department  offer  an  oppor- 
tunity for  continuous  vocational  guidance  within  the  plant. 
When,  a  few  years  ago,  the  possibilities  of  systematic  han- 
dling of  such  transfers  were  discovered,  they  were  described 
as  a  panacea  for  nearly  all  employment  troubles.  Many  indus- 
tries greatly  reduced  turnover  by  simply  inducing  employees 
who  desired  to  leave  to  take  positions  elsewhere  in  the  same 
organization.  This  not  only  conduces  to  better  adjustment; 
it  partially  gratifies  that  desire  for  change  and  adventure  that 
is  the  prime  cause  of  individual  unrest. 

Promotions  may  be  the  most  prolific  source  of  good-will, 
or  of  antagonism,  jealousy,  hatred,  and  disorder.  Nothing 
so  quickly  and  rightly  rouses  that  righteous  indignation  that 
hates  injustice  as  the  belief  that  promotions  go  by  favor 
and  not  by  justice.  Promotions  should  be  based  upon  such 


162  PERSONNEL   RELATIONS   IN   INDUSTRY 

records  as  have  already  been  described,  rating  production, 
attendance,  ability,  and  other  desirable  qualities.  In  spite  of 
the  difficulties  already  referred  to,  the  only  occasion  when  a 
character  rating  can  be  made  with  any  sense  of  fairness  is 
in  connection  with  promotions.  Character  is  a  result  of  the 
two  forces,  personality  and  environment.  Hence  it  is  a  most 
variable  quantity,  and  impossible  to  judge  fairly  where  only 
personality  is  considered.  Within  the  plant  the  environment 
is  to  some  extent  controlled,  and  at  least  known,  and  may 
be  allowed  for. 

Rating  Emotions 

The  most  stable  element  in  what  is  commonly  called  char- 
acter is  probably  emotion,  which  lends  itself  to  fairly  accurate 
rating.  John  B.  Watson,  professor  of  psychology  in  Johns 
Hopkins  University,  has  prepared  a  scale  for  rating  emotions. 
Although  this  is  not  intended  specifically  for  industry,  and 
could  not  be  adopted  for  such  use  without  alteration,  it  is 
suggestive  of  the  elements  that  must  be  considered  in  such  a 
rating.  It  also  follows  the  lines  of  the  system  of  rating  used 
in  the  army,  which  is  now  being  introduced  into  industry. 
He  gives  these  instructions : 7 

Rate  each  man  in  each  of  the  following  points: 

1.  On   Normality   of   Sensitivity   to   Emotional   Stimuli. 
The  questions  before  you  in  this  rating  are:  Does  he  show 
anger  on  insufficient  provocation,  or  does  he  pass  by  all  situ- 
ations without  showing  anger  ?   Does  he  show  fear  on  insuffi- 
cient stimulation,  or  does  he  fail  to  exhibit  fear  where  others 
ordinarily  exhibit  it?    Are  his  attachments  and  detachments 
with  respect  to  persons,  places  and  things  made  on  adequate 
stimulation  ? 

2.  On   the   Evenness    (But  Not  Absence   of  Emotional 
Tone)   of  Emotional  Level.     Assume  that  every  individual 
works  at  three  levels:  normal,  high  and  low. 

TJ.  B.  Watson,  Psychology  from  the  Standpoint  of  a  Behaviorist, 
pp.  327,  .1-3. 


ADJUSTMENTS,    PROMOTIONS,    DISCHARGE  I&3 

3.  On   the  Normality  of  Permanent   General  Attitude. 
Here  you  should  be  guided  by  such  factors  as:  Freedom 
from  such  attitudes  as  exclusion,  inferiority,  suspicion  and 
embarrassment.     On   the  other   hand   the  person  observed 
should  be  free  from  garrulity,  oversensitiveness,  display  or 
exhibition  tendencies. 

4.  On  Freedom  from  Unusual  Outlets  Through   Which 
Emotional  Tension  May  Drain.    Rate  on  such  points  as  free- 
dom from  unsocial  outlets,  such  as  the  chewing  of  the  nails 
in  public;  freedom  from  rumination  and  day-dreaming  car- 
ried to  the  point  where  they  interfere  with  other  activities 
— sub-vocal  language  outlets;   from  eagerness  to  run  into 
danger,    seeking    for   highly    exciting   emotional    situations, 
talking  overly  much  about  sex  matters,  curiosity  about  the 
details  of  other  people's  affairs.     On  the  other  hand,  the 
individual  should  possess  normal  outlets  in  work,  literature, 
music,  play,  dress  and  social  affairs. 

5.  Make  a  Final  General  Rating  on  What  Might  be  Called 
the  Efficiency  of  the  Individual's  Emotional  System.    Here 
two  questions  predominate :  Are  his  total  emotional  assets  of 
such  a  character  that  they  will  not  interfere  with,  but  on  the 
other   hand   will    facilitate   his  work  and   social   relations? 
Is  there  likelihood  of  a  breakdown  under  any  emotion-pro- 
ducing situation  which  is  likely  to  be  met  with  under  the 
ordinary  conditions  of  modern  civilization? 

Planning  for  Promotion 

Promotions  should  never  be  based  on  impulsive,  momen- 
tary judgment.  They  should  be  planned  far  ahead.  Frank 
B.  Gilbreth  has  worked  out  a  promotion  plan  that  seems 
idealistic,  but  which  he  maintains  has  been  found  capable  of 
practical  operation.  Something  of  the  kind  has  long  been 
in  operation  in  many  railroad  offices  and  in  some  civil  service 
departments.  It  offers  a  standard  toward  which  any  plant 
might  well  aim.  It  is.  described  as  follows :  8 

•F.  B.  and  Lillian  Gilbreth,  The  Three  Position  Plan  of  Promotion, 
Annals  of  the  American  Academy,  May,  1916,  p.  290;  see  also  Bloom- 
field,  Selected  Articles  on  Employment  Management,  1919,  pp.  237-243. 
V 


164  PERSONNEL   RELATIONS   IN   INDUSTRY 

The  Three  Position  Plan  of  Promotion  considers  each 
man  as  occupying  three  positions  in  the  organization,  and 
considers  these  three  positions  as  constantly  changing  In 
an  upward  spiral,  as  the  man  is  promoted  from  the  lowest 
position  that  he  occupies  into  the  position  next  higher  than 
the  highest  position  he  occupies.  The  three  positions  are  as 
follows:  first,  and  lowest,  the  position  that  the  man  has 
last  occupied  in  the  organization;  second,  the  position  that 
the  man  is  occupying  at  present  in  the  organization;  third, 
and  highest,  the  position  that  the  man  will  next  occupy. 
In  the  first  position  the  worker  occupies  the  place  of  the 
teacher,  this  position  being  at  the  same  time  occupied  by 
,  two  other  men,  that  is,  by  the  worker  doing  the  work,  who 
receives  little  or  no  instruction  in  the  duties  of  that  posi- 
tion except  in  an  emergency,  and  by  the  worker  below  who 
is  learning  the  work.  In  the  second  position  the  worker 
is  actually  in  charge  of  the  work,  and  is  constantly  also  the 
teacher'  of  the  man  next  below  him,  who  will  next  occupy 
the  position.  He  is  also,  in  emergencies,  a  learner  of  the 
duties  of  his  present  position  from  the  man  above  him.  In 
the  third  position  the  worker  occupies  the  place  of  learner, 
and  is  being  constantly  instructed  by  the  man  in  the  duties 
of  the  position  immediately  above. 


Other  valuable  features  of  the  plan,  aside  from  the 
elaborate  organization  of  understudies,  are  promotion  charts 
and  sheets.  A  master  promotion  chart  is  made  by  the  per- 
sonnel relations  department,  showing  all  possible  lines  of 
promotion  from  each  position.  This  visualizes  the  internal 
movements  of  plant  personnel  and  makes  possible  intelligently 
planned  action  instead  of  hit-or-miss  placing.  Individual 
promotion  sheets  are  supplied  to  each  worker.  These  sheets, 
worked  out  in  consultation  with  each  employee,  plan  for  him 
the  lines  of  possible  advancement  and  make  these  lines  clearly 
visible  to  him,  thus  supplying  that  visualization  of  growth 
with  the  industry  so  essential  to  the  gratification  of  the  crea- 
tive instinct. 


ADJUSTMENTS,    PROMOTIONS,    DISCHARGE  165 

Objection  to  Promotion  Plan 

An  objection  offered  to  this  plan  is  that  most  industries 
have  no  such  symmetrical  system  of  classification  of  positions 
as  it  requires.  The  answer  is  that  the  lack  of  such  a  system 
is  probably  due  to  a  defect  in  organization.  A  better  classi- 
fication of  positions  is 'of  ten  the  first  step  to  efficient  produc- 
tion. Careful  grading  of  jobs  according  to  skill,  experience, 
and  other  qualities  often  reveals  and  makes  possible  the 
removal  of  very  expensive  weaknesses  in  organization.  When 
such  grading  has  been  accomplished,  systematic  promotion 
becomes  easy  and  natural.  No  system  will  fit  into  chaos,  and 
in  an  industry  no  less  than  in  a  machine  standardization  is 
necessary  in  every  part  or  else  the  whole  will  rattle  and  clash. 

All  the  tendencies  of  modern  management  are  toward 
such  a  gradation  of  jobs.  An  adequate  training  system  creates 
a  class  of  producing  teachers.  The  Taylor  system  calls  for 
functional  foremen,  specialized  in  different  directions,  and  of 
greater  value  to  the  plant  because  of  such  specialization. 

Training  System  and  Monotony 

A  training  system  should  also  develop  workers  for  promo- 
tion, and  fit  them  for  transfer  to  various  positions  where  their 
services  may  be  of  most  value.  Proper  interviewing  at  the 
time  of  hiring  and  adequate  job  analysis  will  reveal  many 
employees  capable  of  filling  more  than  one  position.  Oppor- 
tunity for  promotion  to  a  higher  position  than  the  one  for 
which  the  worker  was  first  hired  should  always  be  kept  in 
view.  Reference  has  already  been  made  to  the  system  of 
records  used  in  the  United  States  Army  personnel  service  to 
facilitate  such  transfers  and  promotions.  The  cards  are  tabbed 
at  the  top  for  each  position  the  person  is  capable  of  filling  or 
for  which  he  can  be  quickly  trained. 

In  spite  of  everything,  it  appears  that  there  will  always 
be  some  "blind  alley"  jobs.  If  careful  analysis  shows  no 


166  PERSONNEL   RELATIONS   IN   INDUSTRY 

natural  opening,  these  should  be  utilized  as  training  stations 
for  unrelated  jobs.  A  suggestion  regarding  their  use  in  this 
way  is  given  by  Henry  Farquhar  in  the  Bulletin  of  the  Taylor 
Society  for  October,  1919: 

Monotony,  where  monotony  exists  (for  there  is  ample 
evidence  that  many  for  whom  in  their  "deadly  monotonous" 
tasks  we  are  prone  to  feel  compassion,  do  not  at  all  envy 
us  with  our  largei  responsibilities),  is  due  not  so  much  to 
the  unvarying  repetition  of  recurrent  operations  as  to  the 
accompanying  feeling  that  the  work  holds  no  future  possi- 
bilities. Introduce  the  possibility  and  the  probability  of  a 
more  attractive  future,  and  the  humdrum  task  becomes  but 
a  stepping  stone,  seen  in  its  proper  relation  to  the  whole 
scheme  of  things,  and  eminently  serviceable  and  satisfactory 
as  a  present  means.  The  belief  that  each  of  us  has  a  mar- 
shal's baton  in  his  knapsack  is  no  less  stimulating  today 
than  it  was  in  Napoleon's  time,  and  the  conviction  that  we 
have  reached  a  position  of  status  is  no  less  deadening. 

Need  for  Regular  Promotion 

Absence  of  regular  promotion  is  a  sign  of  bad  manage- 
ment. Under  efficient  management  workers  grow  with  their 
work.  The  White  Motor  Company  is  one  of  several  well- 
managed  industries  that  have  translated  this  principle  into 
action.  Holding  that  experience  increases  a  worker's  value, 
foremen  must  explain  any  failure  to  grow. 

The  theory  is  that  a  man  should  become  more  valuable 
the  longer  he  is  with  the  company.  With  this  as  a  basis 
the  foreman  who  does  not  recommend  his  men  for  a  raise 
every  six  months  is  called  into  the  office  and  asked  for  an 
explanation.  This  procedure  is  so  contrary  to  the  usual  one 
of  admonishing  a  foreman  for  suggesting  an  increase  that 
it  seems  almost  unbelievable;  yet  the  plan  is  working  out 
very  satisfactorily.9 

*  F.  H.  Colvin,  Labor  Turnover,  Loyalty  and  Output,  1919,  p.  43. 
"The  Packard  Motor  Car  Co.  is  one  of  the  automobile  firms,  at  least, 


ADJUSTMENTS,   PROMOTIONS,   DISCHARGE  167 

There  should  certainly  be  a  regular  compulsory  examina- 
tion of  individual  efficiency  records  at  intervals  of  not  less 
than  three  months  for  new  and  six  months  for  old  employees. 
Each  such  revision  should  bring  either  an  increase  in  pay  or 
an  explanation  from  management  or  men.  Only  when  the 
period  of  physical  and  mental  decline  due  to  age  appears 
should  this  growth  cease.10  The  proper  handling  of  promotion 
is  the  proper  treatment  for  excessive  turnover.  Continuous, 
guaranteed,  impartial  promotion  according  to  ability  and 
seniority  holds  employees  in  the  civil  service  and  in  the  em- 
ployment of  the  great  public  service  corporations. 

Complaints  and  Arbitration  Machinery 

Definite  machinery  for  handling  complaints  should  be 
established  before  a  particularly  bitter  grievance  makes  the 
creation  and  functioning  of  such  machinery  difficult.  To 
build  it  in  time  of  fierce  industrial  conflict  is  difficult,  but 
such  machinery  can  often  function  in  a  time  of  stress  to 
the  satisfaction  of  both  parties  if  it  has  previously  gained 
their  confidence  by  impartial  operation  in  comparatively  peace- 
ful times.  The  tendency  to  make  the  employment  manager 
or  personnel  director  a  general  arbitrator  of  all  labor  difficulties 


that  believes  in  the  efficacy  of  the  unsolicited  raise,  as  a  sincere  means  of 
keeping  men  contented  and  interested  in  their  work.  To  carry  out  the  idea 
in  practice  it  has  worked  out  a  practical  and  successful  system  of  efficiency 
records  under  the  supervision  of  the  employment  department.  These 
records,  which  are  kept  by  the  rate  man  of  the  employment  department, 
relate  to  every  phase  of  the  employee's  work.  They  include  his  production 
efficiency,  his  absences,  his  lateness,  etc.  Such  a  record  is  kept  for  every 
employee  of  the  company.  It  is  on  the  basis  of  this  record  that  the 
employee's  rate  is  raised,  but  a  raise  is  never  granted  without  a  consulta- 
tion with  the  foreman  of  the  man's  department.  .  .  .  When  the  records 
show  that  a  man  is  not,  in  the  opinion  of  the  employment  department  and 
the  foreman,  entitled  to  a  raise  when,  in  the  normal  course  of  events  he 
should  be,  that  man  is  either  called  to  the  employment  department  for  a 
conference  with  the  rate  man  or  with  the  foreman.  The  record  is  shown 
to  the  man  and  the  reasons  for  his  failure  to  receive  a  raise  are  explained." 
— Automotive  Industries,  Mar.  18,  1920,  p.  725. 

10  S.  H.  Slichter,  The  Turnover  of  Factory  Labor,  1919,  pp.  350-360. 


168  PERSONNEL  RELATIONS   IN  INDUSTRY 

creates  a  conflict  o£  duties  which  is  apt  to  end, in  trouble.  No 
one  person,  in  particular  one  who  draws  his  salary  from  one 
party  to  all  disputes,  can  be  so  omnipotent,  omniscient,  and 
impartial  as  constantly  to  retain  the  confidence  of  all  con- 
cerned. On  the  other  hand,  the  personnel  director  can  un- 
doubtedly settle  a  multitude  of  little  difficulties,  concerning 
which  nothing  but  diplomacy,  common  sense,  and  good  judg- 
ment are  required — a  matter  of  great  value  in  avoiding  the 
accumulation  of  frictional  heat  to  the  point  where  ignition 
and  explosion  are  easy. 

Adjusting  complaints  is  suitable  work  for  a  joint  com- 
mittee. Contrary  to  previously  formed  prejudices  of  em- 
ployers, such  a  committee  will  not  multiply  complaints  nor 
show  undue  partiality  toward  employees.  This  has  been  the 
universal  report  where  such  committees  exist.  An  employee 
representative  knows  how  to  distinguish  just  complaints  from 
querulous  quibbles,  and  has  no  hesitation  in  expressing  his 
opinions.  On  the  other  hand,  he  will  fight  hard  for  a  real 
grievance.  Neither  characteristic  is  a  drawback  in  searching 
for  that  standard  of  justice  upon  which  alone  good-will  can 
be  built. 

All  complaints  and  decisions  should  be  recorded.  This 
usually  reduces  their  number  about  two-thirds.  When  fore- 
men and  employees  know  that  complaints  must  be  written  out, 
they  will  come  to  an  agreement  before  putting  on  paper  what 
they  know  will  sound  foolish  when  read  in  cold  blood.  When 
all  action  on  complaints  is  recorded,  there  soon  is  created  a 
custom  concerning  the  more  frequent  differences.  These  cus- 
tomary decisions  finally  come  to  take  on  the  character  of  a 
standard,  or  a  "common  law"  of  industry.  Knowledge  of 
this  custom  will  often  settle  disputes  before  they  reach  the 
stage  of  formal  complaints.  Such  common  law,  however,  "* 
should  never  become  so  binding  that  it  cannot  be  changed 
when  progress  demands  change. 


ADJUSTMENTS,   PROMOTIONS,   DISCHARGE  169 

There  must  be  one  iron-clad  rule:  no  person  must  be  vic- 
timized because  he  makes  use  of  the  machinery  for  complaint. 
This  axiomatic  rule  is  often  violated.  One  case  of  discharge 
or  discrimination  of  any  kind  against  an  employee  because 
he  has  complained  tends  to  destroy  all  faith  in  the  honesty 
of  the  employer  and  all  good-will  on  the  part  of  the  employees. 

Discharges  and  Resignations 

The  power  of  complete  discharge  should  be  vested  only 
in  the  head  of  the  personnel  department.  Foremen  must  have 
the  right  to  discharge  from  their  own  gangs,  but  such  dis- 
charge only  brings  the  case  before  the  personnel  department. 
Even  if  no  provision  for  trial  by  a  joint  board  exists,  the 
causes  for  discharge  should  be  standardized  and  proof  of 
violation  insisted  upon.  Discharge  in  ordinary  times,  and 
even  more  in  times  of  business  depression,  is  a  severe  sen- 
tence. I  have  known  it  to  be  a  death  sentence  for  more  than 
one  helpless  member  of  an  employee's  family.  I  have  known 
many  cases  where  it  involved  economic  ruin,  loss  of  educational 
facilities  for  children,  and  long  poverty  for  many  besides  the 
worker  directly  involved.  No  court  in  any  civilized  country 
would  be  permitted  to  impose  such  penalties  without  con- 
sideration of  tested,  standardized  evidence  to  be  impartially 
measured.  Only  a  joint  body  can  be  trusted  to  give  such 
impartiality  in  industry.  If  such  a  body  does  not  exist,  all 
the  other  safeguards  should  be  used  by  a  personnel  depart- 
ment. 

The  reasons  that  impel  employees  to  leave  constitute  a 
valuable  body  of  constructive  criticism  available  for  the  con- 
trol of  employment  management.  It  is  not  easy  to  get  the 
full  truth  concerning  these  reasons.  The  common  explanation 
is,  "Going  to  get  a  better  job."  Every  separation  should  at 
least  involve  an  interview  with  the  personnel  director,  and 
to  insure  this,  the  final  pay  check  should  not  be  issued  until 


1 7°  PERSONNEL   RELATIONS   IN   INDUSTRY 

the  worker  has  passed  through  the  employment  department. 
This  rule  should  be  made  familiar  to  every  worker  at  the  time 
of  employment. 

If  the  personnel  department  has  the  confidence  of  the 
workers  even  in  a  mild  degree,  the  information  gained  in 
such  final  interviews  will  be  valuable.  The  fact  that  the  in- 
formation is  often  meager  and  indefinite  tells  something  of 
the  lack  of  good-will.  Where  adequate  reasons  are  given  and 
are  classified  and  studied,  they  throw  light  on  weak  places 
in  employment  management.  In  such  final  interviews  there 
should  be  no  arguing  or  criticism,  or  even  reply  to  the  objec- 
tions made,  unless  it  is  felt  that  by  so  doing  a  desirable  em- 
ployee may  be  persuaded  to  return.  If  the  impression  gets 
out  that  this  questioning  is  a  sort  of  "third  degree"  in  which 
the  worker  is  scolded  for  making  criticisms,  then  criticisms 
will  very  probably  stop,  together  with  all  possibility  of  obtain- 
ing worth-while  information. 


CHAPTER  XI 

WORKING  ENVIRONMENT— WELFARE  WORK J 

Essentials  Before  Frills 

"Be  just  before  you  are  generous."  Meet  all  the  condi- 
tions demanded  by  health,  efficient  production,  and  good 
employment  practice,  before  adding  frills  and  favors.  If  this 
policy  is  followed,  some  of  the  frills  will  be  found  essential 
for  good  production,  others  superficial  and  useless,  and  all 
will  be  accepted  in  better  spirit. 

The  first  rule  of  industry  is  that  all  working  energy  should 
be  devoted  to  production.  The  worker  should  not  be  required 
to  struggle  against  his  environment  in  order  to  do  good  work. 
Yet  sometimes  half  the  fatigue  incurred  in  a  plant  is  due 
to  unnecessary  expenditure  of  energy.  To  hunt  out  and 
remove  the  wasteful,  disagreeable,  and  harmful  features  that 
hinder  production  is  a  slow,  hard  task  often  involving  severe 
injuries  to  managerial  pride,  and  usually  requiring  the  recog- 
nition of  many  long-established  errors  in  operation.  As  the 
admission  of  defects  is  never  pleasant,  though  usually  profit- 
able in  the  end,  many  a  director  of  industry  will  forego  the 
profits  to  avoid  the  humiliation  of  admitting  his  defects. 

It  is  much  easier  to  arrange  for  a  restroom,  bowling  alley, 
or  athletic  club,  for  moving  pictures  or  concerts,  than  it  is 
to  organize  industry.  Yet  the  introduction  of  welfare  work 
into  a  badly  organized  industry  is  much  like  applying  a  soft 
poultice  to  an  organic  disease;  the  remedy  is  more  apt  to 
cause  infection  than  to  bring  about  a  cure.  If  the  work  still 


'Daniel   Bloomfield,   Labor  Maintenance,    1920,  treats   most   fully  the 
entire  subject  of  service  work. 

171 


I?2  PERSONNEL   RELATIONS   IN   INDUSTRY 

remains  painful,  nerve-racking,  unnecessarily  fatiguing  and 
irritating,  welfare  work  will  only  bring  from  the  workers  the 
common  and  proper  question:  "Why  don't  they  give  us  a 
fair  chance  before  they  add  the  fancy  frills?" 

Working  Conditions  and  Fatigue 

Good  factory  practice  lays  first  emphasis  upon  perfect 
working  conditions.  It  insists  upon  a  clean,  uncluttered  work- 
place. There  is  no  gain  from  energy  expended  in  climbing 
over  or  going  around  useless  obstructions.  In  an  efficiently 
organized  shop,  all  material  is  delivered  where  it  can  be  used 
with  the  least  possible  exertion;  tools  are  properly  selected 
and  placed  ready  to  hand,  and  the  motions  necessary  are 
reduced  to  the  fewest  possible  and  the  least  fatiguing. 

Careful  physiological  studies  have  determined  the  proper 
posture  for  all  kinds  of  work.  Ignorance  of  these  studies  and 
the  laws  based  upon  them  excuses  no  management  for  neglect. 
There  is  a  least  fatiguing  and  most  efficient  height  for  each 
person  and  class  of  work.  Typists,  given  proper  adjustment 
to  height  and  position,  can  do  from  10  to  20  per  cent  more 
work  daily  and  go  home  less  tired.  Chairs,  benches,  foot- 
rests,  clothing — all  have  been  studied,  and  standards  have 
been  adopted  and  principles  of  use  laid  down  for  almost  all 
occupations.  If  the  production  manager  has  not  already  had 
the  work  properly  organized  with  relation  to  these  matters, 
the  personnel  manager  should  see  that  this  is  done  before  he 
talks  about  welfare  work. 

Light,  Heat,  and  Ventilation 

After  these  often  neglected  fundamentals  of  efficient  pro- 
duction have  been  provided,  attention  should  be  directed  to 
the  equally  essential  features  of  lighting,  heat,  ventilation,  and 
fire  protection.  These  things,  also,  have  been  standardized. 
Engineers  can  now  supply  any  manager  with  the  best  plan 


WORKING   ENVIRONMENT— WELFARE   WORK         173 

of  lighting  for  almost  any  purpose.  The  proper  temperature 
and  humidity  for  efficient  working  and  the  means  of  securing 
such  conditions  have  been  determined  and  are  easy  to  find 
out.  There  is  no  excuse  for  numerous  violations  of  good 
practice  in  these  matters;  their  neglect  is  certainly  not 
profitable,  and  in  any  case  is  only  an  indication  of  bad  man- 
agement. 

The  factory  of  a  few  years  ago  was  hard  to  distinguish 
from  a  jail.  I  once  visited  a  Massachusetts  cotton  factory, 
dating  from  the  early  days  of  the  industry.  It  was  a  massive, 
stone  building  with  occasional  windows  too  deep-set  and  dirty 
to  be  serviceable  for  either  light  or  ventilation.  The  air  was 
so  humid  and  oppressive  that  a  visit  of  an  hour  left  a  feeling 
of  depression.  Not  far  away  was  a  modern  mill,  the  walls 
of  which  were  nearly  all  glass  and  which  was  filled  with 
up-to-date  equipment.  I  was  not  surprised  to  learn  that  even 
higher  wages  and  lower  production  were  not  able  to  keep  up 
the  labor  force  in  the  old  mill,  and  that  the  building  was  soon 
to  be  discarded. 

Noise  and  Accidents 

Noise  was  once  considered  a  negligible  and  necessary 
accompaniment  of  industry.  It  was  not  thought  to  have  any 
effect  on  fatigue  or  production.  "They  are  used  to  it  and 
don't  notice  it/'  was  the  common  explanation  of  its  effect 
upon  the  workers.  When  knowledge  took  the  place  of  guess- 
work, however,  it  was  found  that  sickness  and  accidents  de- 
creased and  production  increased  with  the  removal  of  noise.2 

Closer  study  of  accidents  has  shown  that  their  happening 
is  generally  not  accidental,  but  obeys  well-established  laws. 
They  are  most  frequent  during  the  hours  of  greatest  fatigue, 
when  the  light  is  poorest,3  or  when  the  worker  is  first  em- 

*  Josephine    Goldmark,    Fatigue   and   Efficiency,    1917,   p.   71. 
*E.  E.  Purinton,  Personal  Efficiency  in  Business,  1919,  p.  47. 


174  PERSONNEL   RELATIONS   IN   INDUSTRY 

ployed.  A  chart  of  accidents  according  to  the  age  of  the 
injured  shows  a  peak  at  about  twenty-five,  then  a  gradual 
decline  until,  in  the  later  forties,  when  muscles  and  senses 
grow  less  acute  and  responsive,  the  curve  rises  again.4 

The  prevention  of  accidents  is  a  field  for  employee  co- 
operation which  even  the  most  backward  of  managements 
have  entered.  A  safety  committee  of  employees,  given  genuine 
co-operation  from  the  management,  will  do  more  than  any 
other  single  force  to  prevent  accidents.5  The  enactment  of 
compensation  laws,  factory  inspection,  and  the  development 
of  safety  devices  have  standardized  accident  prevention  until 
there  is  no  longer  any  excuse  for  making  the  industrial  field 
more  dangerous  than  a  battlefield.  Yet  it  still  remains  true 
that  each  year  the  number  of  persons  killed  and  crippled  in 
industry  is  larger  than  the  number  killed  and  wounded  in 
the  entire  American  Expeditionary  Force,  and  that  there  are 
occupations,  to  enter  which,  is  to  undergo  greater  risk  of 
injury  and  death  than  followed  enlistment  in  the  most  active 
division  of  that  force.  Analysis  of  these  accidents  shows  that 


4  Fifth  Annual  Conference  National  Association  Corporation  Schools 
Report,  pp.  331,  332. 

"There  is  a  striking  unanimity  in  the  form  of  organization  for 
efficient  safety  work.  The  original  movement  in  1906  resulted  in  the 
formation  of  shop  committees ;  as  soon  as  it  was  realized  that  the 
problem  was  one  of  the  education  of  the  workman  and  that  his  interest 
must  be  aroused,  means  were  sought  to  turn  the  problem  over  directly 
to  him,  and  I  believe  the  first  safety  committee  was  organized  at  the 
South  Chicago  plant  of  the  Illinois  Steel  Co.  Shop  committees — the 
workmen  themselves — were  given  charge  of  the  safety  work.  It  was 
their  duty  to  investigate  the  cause  of  each  accident,  fix  its  responsi- 
bility, and  make  recommendations  for  a  prevention  of  its  recurrence. 
In  addition  they  were  to  make  regular  inspections  of  the  plants,  and 
by  their  foresight  and  recommendations  were  to  prevent,  as  far  as 
possible,  the  recurrence  of  accidents." — A.  H.  Young,  Industrial  Personnel 
Relations,  Mechanical  Engineering,  July,  1919,  p.  581. 

See  also  Report  of  Committee  on  Safety,  Hygiene  and  Co-operation 
to  Third  Annual  Conference  of  National  Association  of  Corporation 
Schools,  pp.  784-824. 

An  excellent  authoritative  discussion  of  accidents  in  industry  is  found 
in  Public  Health  Bulletin  No.  106,  Comparison  of  an  Eight-Hour  Plant 
and  a  Ten-Hour  Plant. 


WORKING   ENVIRONMENT— WELFARE   WORK         175 

most  of  them  are  still  due  to  defects  in  management.6  Until 
such  defects  are  remedied,  any  plant  director  should  be 
ashamed  to  talk  of  welfare. 

Plant  Environment  and  Artistic  Sense 

Properly  constructed  buildings  forestall  many  undesirable 
and  unprofitable  features  of  employment.  So  far  has 
standardization  advanced  in  this  field  that  no  industrial  man- 
agement is  justified,  either  from  financial  or  human  considera- 
tions, in  building  a  plant  without  consulting  expert  engineers 
and  arranging  the  layout  so  that  work  may  be  done  with  the 
least  possible  fatigue  and  the  greatest  possible  safety  and 
comfort,  with  some  thought,  also,  of  agreeable  surroundings. 
There  is  neither  a  federal  nor  state  law,  nor  municipal 
ordinance,  in  this  nation  requiring  industry  to  be  conducted 
in  hideous,  barrack-like  buildings,  although  a  visitor  from 
another  planet  might  think  the  contrary.  In  some  French 
cities  the  law  insists  upon  certain  standards  of  beauty  as  well 
as  comfort  in  industrial  structures.  This  matter  directly 
affects  efficient  production.  American  industry  suffers  greatly 
from  a  lack  of  the  recognition  of  the  value  of  beauty.  French 
industry,  in  spite  of  defective  organization,  less  use  of  power, 
and  the  practice  of  many  backward  methods,  leads  the  world 


*  "Safety  protection  in  its  broadest  sense  covers  not  only  protection 
from  grave  dangers,  but  from  anything  that  might  have  a  harmful  effect 
upon  the  worker's  body  and  mind.  The  standard  to  be  set  is  that  every- 
thing should  be  safe,  not  only  when  the  work  is  done  by  experienced 
adult  workers,  but  even  should  it  be  done  by  inexperienced,  immature 
or  tired  workers.  We  know  how  many  accidents  happen  to  the  inex- 
perienced worker  that  would  ne%rer  happen  to  the  experienced  worker. 
We  all  know  how  many  children  are  hurt,  where  an  older  person  would 
see  and  avoid  danger ;  and  we  note  every  day,  more  and  more  clearly, 
that  the  exhausted  worker  is  to  an  enormous  extent  more  susceptible 
to  accidents  than  the  rested  worker.  It  is  usually  the  tired  motorman 
who  has  the  collision.  The  tired  locomotive  engineer  passes  the  stop 
signal.  The  exhausted  motorist  is  in  the  accident.  The  tired  operator 
gets  his  finger  caught  in  the  machine.  The  overtired  sickroom  attendant 
gives  the  wrong  medicine." — F.  B.  and  Lillian  M.  Gilbreth,  Fatigue  Study, 
1916,  p.  85. 


IT6  PERSONNEL   RELATIONS   IN   INDUSTRY 

in  many  lines  because  it  knows  and  follows  the  laws  of  beauty. 
American  industry  will  some  day  awake  to  the  fact  that  the 
opportunity  to  design  and  make  beautiful  things  amid  beauti- 
ful surroundings  is  not  only  the  foundation  of  that  gratifica- 
tion of  the  instinct  of  craftsmanship  which  lies  at  the  basis 
of  satisfactory  industrial  relations,  but  is  also  the  surest 
foundation  upon  which  to  build  international  trade. 

The  workers  compose  the  largest  section  of  the  market 
for  nearly  all  goods.  If  they  are  trained  by  their  work  and 
their  surroundings  to  appreciate  beauty,  then  they  will  make 
beautiful  things  and  will  buy  no  other.  This  is  the  only 
method  by  which  that  most  valuable  industrial  asset,  a  na- 
tional artistic  sense,  can  be  created.  The  money  expended  in 
landscape  gardening,  in  erecting  fine-looking  buildings  and 
creating  an  atmosphere  of  good  taste  around  a  factory,  will 
come  back  many  times  and  in  many  and  devious  ways.  The 
worker  who  is  justly  proud  of  the  plant  in  which  he  works 
and  the  product  that  comes  from  his  hands  is  a  valuable 
industrial  asset.  Any  other  type  of  worker  is  a  liability  to 
all  concerned,  and  most  of  all  to  himself. 

Overwork  and  Nervous  Strain 

When  the  environment  has  been  made  as  attractive  as  is 
profitably  possible,  there  will  still  remain  much  to  be  done  to 
make  the  work  itself  pleasant  before  the  limit  of  profitable 
improvement  is  reached.  The  worker  and  society  are  in- 
terested in  a  lifetime  of  work  and  not  in  any  shorter,  more 
intensive,  period.  Moreover,  the  worker  wishes  that  produc- 
tive life  to  be  as  long  as  possible.  That  present-day  industry 
offers  a  danger  to  this  standard  is  suggested  by  the  statement 
of  E.  E.  Rittenhouse,  president  of  the  Life  Extension  In- 
stitute, that,  "there  is  a  marked  decline  in  the  power  of 
American  workers  to  withstand  the  strain  of  modern  life. 
They  wear  out  sooner  than  they  did  a  few  years  ago.  The 


WORKING   ENVIRONMENT— WELFARE   WORK          177 

chances  of  death  after  reaching  the  prime  of  life  have  in- 
creased because  of  the  extraordinary  increase  in  the  death-rate 
from  the  breaking  down  of  the  heart,  kidneys,  and  of  the 
nervous  and  digestive  systems."  That  the  death-rate  in  all 
nations  varies  inversely  with  income  and  is  highest  among 
manual  laborers,  indicates  that  there  is  some  relation  between 
overwork  and  short  lives,  and  that  industry  is  not  so  organized 
as  to  secure  the  longest  possible  productive  period  from  its 
personnel. 

This  position  is  confirmed  by  a  statement  of  Irving  Fisher, 
of  Yale  University  (Senate  Document  419,  p.  669) : 

The  economic  waste  from  undue  fatigue  is  probably 
much  greater  than  the  waste  from  serious  illness.  We  have 
seen  that  the  average  illness  per  capita  is  usually  about  two 
weeks  per  year.  This  is  about  four  per  cent  of  the  year. 
Expressed  differently  about  four  per  cent  of  the  population 
is  constantly  sick.  On  the  other  hand  the  number  that 
suffer  partial  disability  through  undue  fatigue  certainly  con- 
stitute the  great  majority  of  the  population.  No  observer 
can  fail  to  conclude  that  this  is  true  of  the  American  work- 
ing, business  and  professional  classes,  and  the  latest  word 
among  students  of  school  hygiene  is  that  it  is  true  to  a 
large  extent  even  among  children.  .  .  .  Yet  if  only  50  per 
cent  of  the  population  are  suffering  an  impairment  equal 
to  only  ten  per  cent  of  its  working  powers,  the  result  is 
equivalent  to  five  per  cent  of  the  population  suffering  total 
impairment. 

The  Laws  of  Fatigue 

Production  engineers  know  that  most  of  this  fatigue  is 
unnecessary.  A  study  of  the  laws  of  fatigue  is  essential  to 
any  intelligent  treatment  of  human  welfare  in  industry. 
Through  the  elaborate  studies  and  experiments  of  Italian  and 
French  physiologists,  supplemented  by  investigations  of  scien- 
tists and  engineers  in  this  country,  the  most  important  of  these 
laws  have  been  discovered  and  formulated.  They  have  been 


I?8  PERSONNEL   RELATIONS   IN   INDUSTRY 

summarized  by  Jules  Amar,  the  French  scientist,  as  follows : T 

1.  The   expenditure   of  energy   is   in  proportion   to   the 
muscular  effort  of  contraction,  to  its  duration,  and  to  the 
degree  of  contraction. 

2.  The  expenditure  of  energy  required  to  perform  a  given 
amount  of  work  diminishes  in  proportion  as  the  rapidity  of 
the  muscular  contractions  increases.     But  this  is  true  only 
within  certain  limits  of  speed,  beyond  which  nervous  exhaus- 
tion will  ensue,  together  with  profound  physiological  dis- 
turbances. ...  A  rapid   rate  of  work   is   permissible  only 
when  it  does  not  overload  the  organs  of  circulation  and 
respiration.    Under  such  conditions  speed  is  really  econom- 
ical.   Modern  industry,  which  demands  the  qualities  of  skill 
and  speed  far  more  than  strength,  should  confine  itself  to 
those  economical  speeds,  of  which  the  Taylor  system  sus- 
pected the  existence,  although  it  could  not  state  what  they 
were. 

3.  There  is  a  most  favorable  effort  and  a  most  favorable 
speed  for  the  performance  of  the  maximum  of  work  with 
the  minimum  of  effort.  .  .  . 

4.  A  muscle   returns  more  speedily  to  its   condition  of 
repose  in  proportion  as  its  work  has  been  more  rapidly  per- 
formed.    This  law,  formulated  in  1910,  is  entirely  compar- 
able to  the  law  of  the  cooling  of  heated  bodies.  .  .  .  Simi- 
larly   the    consumption    of    oxygen,    which    expresses    the 
expenditure  of  energy,  decreases  progressively  from  the  ter- 
mination   of    the    work    until    the    condition    of    repose    is 
regained,  and  this  decrease  proceeds  rapidly,  the  return  to 
the  initial  condition  occurring  quickly  when  the  work  has 
been  strenuous — of  course  within  certain  limits.     The  law 
of   this   decrease   enables  us  to   determine  the   interval   of 
rest   which    is   necessary   on   each  occasion   to   restore   the 
physiological  conditions  which  obtained  at  the  outset,  and  to 
divide  the  work  into  reasonable  shifts.    In  this  way  a  large 
daily  output  will  be  obtained  without  impairing  the  resist- 
ance of  the  organism. 


'Jules  Amar,  The  Physiology  of  Industrial  Organization,  1919,  pp. 
98-102,  et  passim.  The  first  three  laws  are  by  Chaveau,  the  fourth  by 
Amar. 


WORKING   ENVIRONMENT— WELFARE   WORK          179 

In  discussing  these  laws  Amar  very  properly  observes : 

The  whole  science  of  human  labor  is  condensed  in  these 
four  laws,  and  the  whole  art  of  working,  together  with  the 
whole  of  physical  education,  resides  in  their  application. 
Duly  to  proportion  effort  and  pace,  to  enforce  intervals  of 
repose — this  is  the  secret  of  normal  activity,  exempt  from 
overwork,  and,  what  is  even  better,  favorable  to  the  com- 
plete development  of  the  functions  of  life.  Whether  in 
physical  or  intellectual  exertion,  everything  is  a  question  of 
measure,  of  discipline;  that  is  to  say  of  order  and  harmony. 

Cause  .of  Fatigue 

Every  form  of  work  for  the  welfare  of  labor  should  be 
guided  by  the  knowledge  of  these  laws  of  fatigue  and  recovery. 
We  know  that  fatigue  is  a  deadly  disease  when  pushed  to 
extremes.  It  is  due  to  the  creation  of  a  poisonous  toxin 
thrown  off  by  an  exhausted  muscle,  and  carried  by  the  blood 
throughout  the  body.  A  few  drops  of  this  toxin,  taken  from 
the  blood  of  an  exhausted  animal  and  injected  into  the  blood 
vessels  of  another  and  entirely  fresh  animal,  will  cause  the 
latter  immediately  to  show  all  the  symptoms  of  fatigue.  Until 
this  toxin  has  been  eliminated  by  proper  rest  and  recreation, 
the  person  in  whose  veins  such  poisoned  blood  circulates  is  a 
sick  person.8  The  need  for  this  alternate  work  and  recreation 
is  the  scientific  foundation  of  all  genuine  welfare  work.  After 
all  has  been  done  that  is  possible  to  make  the  work  itself 
pleasant,  healthful,  and  efficient  there  still  remains  a  certain 
amount  of  purely  normal  and  necessary  fatigue.  Such  fatigue 
is  injurious  only  if  it  is  permitted  to  accumulate.  To  prevent 
such  accumulation  there  must  be  an  alternation  of  work  and 
rest.  If  the  rhythm  of  such  alternation  is  properly  main- 
tained, the  human  machine  can  run  through  a  long  lifetime 
without  injury. 

*J.   B.   Watson,   Psychology   from  the   Standpoint   of   a   Behaviorist, 
p.  168;  also  pp.  167,  168  on  laws  of  fatigue. 


180  PERSONNEL  RELATIONS   IN   INDUSTRY 

Rhythm  of  Work  and  Rest 

This  relation  of  rhythm  to  life  and  labor  is  vividly  set 
forth  by  Josephine  Goldmark:  9 


r 


The  reason  why  rhythm  makes  work  easier  as  well  as 
more  enjoyable  is  that  in  any  given  tempo,  each  effort  is 
followed  by  a  corresponding  rest.  There  is  perfect  balance 
of  swing  and  recovery,  rise  and  fall,  exertion  and  repose — 
"primal  chimes"  as  Emerson,  the  lover  of  rhythm,  calls 
them: 

Primal  chimes  of  sun  and  shade 

Of  sound  and  echo,  man  and  maid.  .  .  . 

For  Nature  beats  in  perfect  tune, 

And  rounds  with  rhythm  her  every  rune. 

If  such  a  balance  could  be  permanently  established  in 
work,  fatigue  would  never  occur.  Such  a  condition  exists 
in  the  physiological  rhythm  of  the  heart  and  respiratory 
muscles,  which  function  unceasingly  through  life,  alter- 
nating work  and  rest,  work  and  rest.  In  its  steady  rhythmic 
tempo  the  heart  relaxes  at  each  contraction,  exerting  en- 
ergy estimated  at  about  20,000  kilogrammeters  in  one  day. 
-J  Thus  we  are  physiologically  attuned  to  rhythm.  It  is 
our  common  heritage.  The  injury  of  highly  speeded  machine 
work  lies,  as  we  have  said,  in  this,  that  the  mechanical, 
rapid  rhythm  of  machinery  dominates  the  human  agent, 
whatever  be  his  natural  rate  of  rhythmic  tendency.  The 
machine  sets  the  tempo;  the  worker  must  keep  to  it. 

Not  only  is  the  beat  of  the  machine  much  more  rapid 
and  regular  than  the  more  elastic  human  rhythms,  it  is 
often  wholly  lost  in  the  chaos  of  different  rhythms  of  the 
various  machines,  belts  and  pulleys  in  one  workroom.  The 
roar  and  vibration  of  the  machinery  tends  further  to  distract 
any  sense  of  rhythm  on  the  part  of  the  worker. 


'Josephine  Goldmark,  Fatigue  and  Efficiency,  1917,  pp.  81,  82.  See 
especially  Rhythm  in  Industry,  Health  Bulletin  No.  106,  pp.  200-210.  P. 
S.  Florence,  Use  of  Factory  Statistics  in  Investigation  of  Industrial 
Fatigue. 


WORKING  ENVIRONMENT— WELFARE  WORK          ll 

This  law  of  rhythm  is  further  re-enforced  by  certain  fea- 
tures of  the  laws  of  fatigue.  Italian  investigators  have  proved 
that  work  done  after  fatigue  sets  in  requires  a  much  greater 
expenditure  of  nervous  energy  than  work  done  before  fatigue 
supervenes.  That  is,  fatigue  becomes  rapidly  cumulative.  If 
this  process  continues  until  muscles  are  exhausted,  the  period 
for  recuperation  is  several  times  as  great  as  if  frequent  rest 
intervals  had  alternated  with  work  at  high  speed.  "If  work 
is  reduced  one-half,  the  period  of  necessary  rest  can  actually 
be  reduced  half  or  three-quarters  as  much  again.  Thus,  if 
30  contractions  exhaust  the  finger  muscle  so  that  it  needs  two 
hours'  rest,  15  contractions  require,  not  one  hour,  but  only 
half  an  hour  for  recuperation."  10  It  has  also  been  shown 
that  work  done  after  fatigue  sets  in  is  not  only  done  with 
greater  effort,  but  that  much  less  can  be  accomplished ;  more- 
over, if  the  work  is  of  a  kind  that  involves  judgment,  it  is 
apt  to  be  of  poorer  quality. 

With  these  laws,  as  with  other  natural  laws,  the  conse- 
quences of  violation  are  not  avoided  because  the  laws  are 
not  known.  "Ignorance  of  the  law  excuses  no  one."  Wel- 
fare is  largely  a  matter  of  organized  recreation  and  rest — of 
care  for  health,  amusement,  and  recovery  from  fatigue.  Un- 
less such  care  is  based  upon  a  knowledge  of  the  laws  of  fatigue 
it  is  apt  to  do  as  much  harm  as  good. 

The  study  of  fatigue  plainly  indicates  that  short  hours 
are  more  productive  than  the  long  working  day,  and  that 
even  the  shortest  day  that  is  yet  customary  in  industry  will 
be  more  productive  if  interspersed  with  short  compulsory  rest 
periods.  This  conclusion  is  in  line  with  the  tabulated  results 
of  experiments  everywhere.  More  and  more  the  value  is  being 
recognized  of  short  five-  to  fifteen-minute  rest  periods,11  with 


"Josephine  Goldmark,  Fatigue  and  Efficiency,  1917,  pp.  33,  34. 
11  Factory,  Nov.  1918,  pp.  842-845.   Details  of  experiments  by  50  pranta 
with  various  forms  of  short  rest  periods;  United  States  Bureau  of  Labor 


182  PERSONNEL   RELATIONS   IN   INDUSTRY 

calisthenic  movements  for  office  workers  and  music  or  pictures 
for  manual  laborers.  Such  intervals  of  relaxation  will  be 
truly  recreatory  and  of  much  more  value  than  similar  enter- 
tainments at  the  end  of  the  day  or  in  the  evening. 

The  Organization  of  Amusement 

The  organization  of  pleasure,  either  in  such  short  rest 
periods  or  in  the  longer  ones  at  the  end  of  the  day  or  the 
week,  affords  an  opportunity  for  the  formation  of  clubs  of 
various  kinds,  gymnasium  classes,  and  other  forms  of  social 
activity  usually  associated  with  welfare  work.  The  World 
War  taught  the  possibilities  of  organized  recreation.  The 
methods  that  were  so  valuable  in  maintaining  morale  in  war 
will  produce  the  same  results  in  industry.  The  work  of  com- 
munity amusement  now  being  developed  through  social 
centers,  the  public  schools,  parks,  and  similar  institutions  shows 
the  very  great  value  and  joy  that  may  be  derived  from  leader- 
ship, organization,  and  intelligent  direction  of  group  amuse- 
ment. Here  is  a  splendid  opportunity  to  arouse  group  soli- 
darity. Human  beings  prefer  to  play  together.  Here  is  the 
field  for  rival  baseball  clubs  and  similar  organizations,  be- 
tween which  there  can  be  encouraged  the  sharpest  competition 
— a  competition  that  may  find  a  healthy  reflection  in  industry. 

There  will  be  little  joy  or  response  if  the  organization 
of  amusement  is  paternalistic,  interfering,  and  autocratic.  No 
one  likes  to  have  things  done  for  him,  no  matter  how  much 
he  may  need  them.  This  is  especially  true  of  intimate  per- 
sonal things  like  the  organization  of  play,  the  care  of  health, 
etc.  The  people  of  America  will  for  years  be  feeling  a  sort 
of  hurt  wonder  at  the  lack  of  gratitude,  and  even  friendship, 
from  the  peoples  whom  we  fed  and  clothed  and  cared  for 
through  the  Red  Cross  and  relief  commissions  during  the 

Statistics,  Welfare  Work  for  Employees  in  Industrial  Establishments, 
Bulletin  No.  250,  pp.  33-35,  250. 


WORKING   ENVIRONMENT— WELFARE   WORK          183 

Great  War.  It  is  always  so.  A  few  years  ago  a  friend  of 
mine,  on  returning  from  a  Cuban  trip,  bitterly  berated  the 
Cubans  because  they  were  not  friendly  to  the  United  States, 
after  it  had  cleaned  up  their  cities,  built  sewage  systems, 
abolished  yellow  fever,  and  established  law  and  order.  "How 
would  you  like  it,"  I  asked,  "if  kind  neighbors  cleaned  up 
your  back  yard,  gave  your  house  a  scrubbing,  punished  your 
children  for  fighting,  and  tried  to  settle  a  dispute  between 
you  and  your  wife?"  The  instincts  of  independence  and 
self-assertion  are  more  powerful  than  are  those  of  submission 
and  loyalty.  It  is  well  that  it  is  so,  as  much  of  human  progress 
is  due  to  the  fact  that  it  is  more  fun  as  well  as  more  blessed 
to  give  than  to  receive. 

A  few  years  ago  a  great  employers'  association  introduced 
an  elaborate  system  of  welfare  work,  with  clubs  and  smoking- 
rooms  for  the  sailors  of  the  Great  Lakes.  At  the  same  time 
war  was  declared  upon  the  sailors'  union.  To  this  day,  few 
things  arouse  as  fervid  a  display  of  a  sailor's  sulphuric  voca- 
bulary as  a  reference  to  that  welfare  system.  Finally,  a 
bitter  strike  was  waged  to  secure  the  abolition  of  the  plan 
that  was  intended  to  buy  the  good-will  of  the  sailors.12  Any 
sort  of  intimate  welfare  work,  dealing  with  amusement,  health 
care,  accident  prevention,  or  other  personal  affairs,  must  be 
under  joint  management,  or  entire  labor  management,  if  it 
is  to  form  a  permanent  foundation  for  industrial  good-will. 

Care  for  Health 

Closely  akin  to  relief  from  fatigue,  is  care  for  the  health. 
This  is  one  of  the  first  fields  of  welfare  activity.  Studies 
of  the  amount  of  sickness  show  that  between  six  and  fourteen 
days  are  lost  by  each  worker  annually,  and  all  observers  agree 


a  Monthly  Review  of  the  Bureau  of  Labor  Statistics,  April,  1918,  pp. 
257-259. 


1 84  PERSONNEL  RELATIONS   IN  INDUSTRY 

that  about  half  of  this  could  be  prevented  by  proper  care. 
Since  the  direct  expense  in  wages  for  this  sickness  is  more 
than  half  a  billion  dollars  annually,  and  indirect  expenses  are 
still  greater,  the  amount  which  can  be  saved  by  proper  health 
precautions  is  far  greater  than  any  such  precautions  would 
cost.  To  such  economy  must  also  be  added  a  sum,  probably 
equally  large,  resulting  from  the  increased  productive  power 
of  those  who  are  at  present  at  work  but  are  not  well. 

The  employment  of  a  physician  and  nurse,  with  physical 
examinations  at  the  time  of  hiring,  and  the  maintenance  of 
plant  hospitals  and  first-aid  stations  are  becoming  matters  of 
good  plant  practice  almost  everywhere.13  Where  these  ex- 
aminations are  made  periodically  and  form  the  basis  of  simple 
instruction  in  first  aid  and  hygiene,  the  work  is  more  practical 
than  when  confined  to  the  treatment  of  injuries  and  illness, 
preventive  measures  being  always  more  profitable  than  cura- 
tive measures.  First  aid  and  health  instruction  are  closely 
allied  to  safety  work,  and  should  therefore  be  organized  by 
more  or  less  employee-controlled  bodies.1* 

The  Industrial  Physician 

Out  of  this  work  is  growing  a  new  department  of  medical 
care  and  the  new  occupation  of  "industrial  physician."  For 
this  profession  a  training  much  wider  than  that  required  for 
ordinary  practice  is  demanded.  There  must  be  a  knowledge 
of  employment  problems,  and  especially  of  employment 
psychology.  More  and  more  we  are  coming  to  realize  that 
many  of  the  problems  of  industry  call  for  the  special  knowl- 
edge of  the  psychiatrist.15  The  physician  who  is  engaged  in 


"Bureau  of  Labor  Statistics,  United  States  Department  of  Labor, 
Bulletin  No.  250,  pp.  14-32. 

"Bureau  of  Labor  Statistics,  United  States  Department  of  Labor, 
Bulletin  No.  250,  pp.  16-18;  Public  Health  Bulletin  No.  99,  Studies  of 
the  Medical  and  Surgical  Care  of  Industrial  Workers. 

"Stanley   Cobb,   Applications   of   Psychiatry   to    Industrial   Hygiene, 


WORKING  ENVIRONMENT— WELFARE  WORK          185 

industrial  work  should  be  familiar  with  the  latest  researches 
in  the  field  of  the  operation  of  human  instincts,  in  the  laws 
of  fatigue,  the  technique  and  theory  of  psychological  tests, 
and  the  phenomena  of  group  as  well  as  individual  psychology. 
The  introduction  of  the  psychologist  and  the  psychiatrist 
into  industry  is  throwing  new  light  upon  a  multitude  of  prob- 
lems concerning  which  analogous  work  in  the  army  has  given 
much  new  information.  A  case  in  point  is  that  of  the  large 
number  of  soldiers  who  fell  victims  to  nervous  disorders. 

A  striking  number  of  the  histories  showed  that  in  civil 
life  these  men  drifted  from  one  employment  to  another, 
never  breaking  down  enough  to  consult  a  physician,  but 
adding  their  numbers  to  the  shifting,  inefficient  labor  ele- 
ment so  costly  to  employers.  It  took  the  rigor  of  army  life, 
with  no  possibility  of  escape  by  moving  on,  to  bring  out 
their  symptoms.  Before  these  people  have  left  their  work 
or  have  been  fired  for  inefficiency,  they  should  have  been 
interviewed  by  some  one  competent  to  understand  them  and 
their  probable  troubles.  At  such  times  advice  from  a  physi- 
cian, the  loan  of  some  money,  a  visit  to  a  sick  child  or  wife, 
or  any  of  the  thousand  possible  personal  and  individual 
aids,  might  save  the  worker  from  becoming  soured,  keep 
him  from  joining  the  ranks  of  the  discontented  and  prevent 
the  development  of  a  litigant  and  paranoid  personality.18 

Essentials  of  Plant  Hygiene 

A  recent  report  of  the  United  States  Public  Health 
Service,  after  a  careful  analysis  of  industrial  medical  care, 
makes  four  recommendations  as  to  the  essential  foundation 
for  such  work:  1T 


Journal  of  Industrial  Hygiene,  Nov.  1919,  pp.  343-347,  summarized  in 
Monthly  Labor  Review,  Jan.  1920,  pp.  226-229;  E.  E.  Southard,  The 
Mental  Hygiene  of  Industry,  Industrial  Management,  February,  1920, 
pp.  101,  102. 

w  Stanley  Cobb,  Applications  of  Psychiatry  to  Industrial  Hygiene, 
Journal  of  Industrial  Hygiene,  Nov.  1919,  quoted  in  Monthly  Labor 
Review,  Jan.  1920,  p.  228. 

"  Public  Health  Bulletin  No.  99.    Studies  of  the  Medical  and  Surgical 


186  PERSONNEL   RELATIONS   IN  INDUSTRY 

1.  That  standards  be  formulated  for  vocational  require- 
ments, physical  examination  of  workers,  vocational  place- 
ment of  workers,  working  conditions,  maintenance  of  health 
among  workers,  medical  and  surgical  practices  in  industry, 
and  systems  for  recording  and  reporting  morbidity  statistics, 
conditions  of  sanitation,  etc.,  in  industrial  plants. 

2.  That   medical   colleges  provide   courses   in   industrial 
sanitation  and  hygiene. 

3.  That  knowledge  of  industrial  hygiene  be  spread  among 
the  medical  profession,  industrial  physicians,  and  employers 
and  industrial  workers. 

4.  That  provision  be  made  so  that  industrial  establish- 
ments may  readily  secure  industrial  physicians,  sanitarians 
and  nurses. 

In  such  broad  measures  for  the  care  of  health  there  is  an 
opportunity  for  all  the  economies  of  group  action  and  a  solid 
basis  for  group  solidarity.  The  most  common  objection  on 
the  part  of  labor  to  welfare  work  is  expressed  in  the  frequent 
statement,  "put  it  in  the  pay  envelopes  and  we'll  buy  our  own 
fun."  But  the  amount  which  will  buy  much  fun  and  care, 
if  expended  as  a  single  group  sum  for  many  persons,  would 
amount  to  but  very  little  if  divided  and  "put  in  the  pay 
envelopes." 

Health  and  Life  Insurance 

The  advantage  of  co-operation  is  even  greater  in  the  ad- 
ministration of  health  and  life  insurance.  The  firm  can  buy 
such  insurance  for  an  entire  industrial  group  for  much  less 
than  the  rate  charged  to  the  individuals.  Moreover,  an  in- 
cidental benefit  results  from  the  introduction  of  group  life 
and  sickness  insurance.  The  companies  that  sell  such  insur- 
ance insist  upon  standard  conditions  of  employment  that  are 
somewhat  above  the  average.  Many  pension,  sick,  and  death 


Care  of  Industrial  Workers;  also  summarized  in  Industrial  Information 
Service,  Apr.  i,  1920,  pp.  10,  n. 


WORKING  ENVIRONMENT— WELFARE  WORK          *7 

benefit  plans  are  also  operated  as  part  of  various  welfare 
systems.18  It  should  be  borne  in  mind,  however,  that  wherever 
such  plans  punish  an  employee  for  leaving,  withholding  any 
part  of  legitimate  benefits  of  funds  to  which  he  has  con- 
tributed, even  in  part,  the  result  is  apt  to  arouse  hostility 
rather  than  good-will.  Gratitude,  loyalty,  and  least  of  all 
good-will,  cannot  be  forced.  They  must  be  earned,  and 
deserved.19 

Restaurants  and  Other  Facilities 

The  operation  of  restaurants  and  lunchrooms  constitutes 
another  method  of  taking  advantage  of  group  power  in  buying 
and  handling  material  and  services.  Money  spent  in  this  way 
will  buy  more  and  better  food  than  the  same  amount  dis- 
tributed in  the  pay  envelopes  of  the  individual  employees 
would  enable  them  to  purchase.20 

Education  is  closely  linked  up  with  training,  which  has 
already  been  discussed.  Lockers,  washrooms,  and  toilet  facili- 
ties, are  standardized  until  there  is  no  excuse  for  poor  practice 
in  these  regards.  The  organization  of  clubrooms,  gymna- 
siums, etc.,  is  part  of  the  work  of  recreation  which  should 
not  be  considered  until  a  group  spirit  has  been  created  by 
good  employment  practice,  and  until  working  conditions  are 


"Welfare  Work  for  Employees  in  Industrial  Establishments  in  the 
United  States  Bureau  of  Labor  Statistics,  Bulletin  No.  250,  pp.  100-112. 
Full  discussion  of  all  forms  of  disability  funds,  pensions,  and  group 
insurance. 

*  "Organized  labor  is  opposed  to  group  insurance  and  for  the  same 
reasons  that  it  is  opposed  to  employers'  welfare  plans  in  general.  .  .  . 
It  is  asserted  that  it  'ties  a  man  to  the  job'  and  is  aimed  at  or  tends 
to  prevent  the  organization  of  labor  or  to  weaken  it  and  defeat  its 
economic  ends — higher  wages,  shorter  hours,  and  better  working  condi- 
tions. And,  again,  it  is  said  that  it  will  place  a  premium  on  the  physical 
examination  of  workmen  and  the  rejection  or  possibly  the  discharge 
of  the  least  desirable  risks  among  them  so  as  to  keep  the  premium  down 
to  a  minimum." — Illinois  Health  Insurance  Commission,  Report  for  1919, 
p.  139.  (Contains  full  discussion  of  all  phases  of  subject.) 

**  Bulletin  Bureau  of  Labor  Statistics,  No.  250,  pp.  53-67. 


188  PERSONNEL   RELATIONS   IN   INDUSTRY 

such  as  to  insure  their  use.  There  have  been  many  instances 
of  almost  luxurious  clubhouses  seldom  visited  by  the  em- 
ployees. Before  they  can  be  considered  of  value,  it  should 
be  certain  that  the  facilities  they  afford  cannot  be  better  fur- 
nished by  outside  agencies,  organizations,  or  the  community.21 

The  Housing  Problem 

Housing  is  a  pressing  problem  all  over  the  world,  as  this 
is  written.22  Whether  providing  houses  for  its  workers  is  a 
proper  function  for  an  industrial  organization  must  depend 
upon  circumstances.  There  have  been  some  bad  experiments 
made  in  this  direction.  I  visited  Pullman  in  the  late  nineties 
while  the  embers  of  the  great  industrial  conflict  engendered 
by  that  paternalistic  plan  were  still  glowing,  and  nowhere 
have  I  seen  such  concentrated  hatred  against  an  employer.  One 
man  explained  it  by  saying  that  there  was  but  one  object  to 
curse  for  everything — the  company.  If  the  gas  was  poor, 
the  sewage  defective,  the  water  bad,  the  plumbing  broken,  the 
company  was  to  blame.  Its  meddling  regulations  and  mer- 
ciless exploitation  had  driven  many  employees  to  a  neighbor- 
ing city,  where  housing  conditions  were  less  satisfactory  but 
mental  freedom  was  greater.  The  most  satisfactory  solution 
of  employer  participation  in  the  housing  problem  is  for  the 
company  to  purchase  the  land  and  then  encourage  the  forma- 
tion of  a  building  and  loan  association  to  finance  building, 
under  complete  control  of  the  employees,  with  no  greater 
restrictions  upon  building  operations  than  are  usually  insisted 
upon  in  a  high-class  residence  district. 

Co-operative  Buying 

In  an  effort  to  meet  the  high  cost  of  living,  many  firms 
introduce  what  they  call  co-operative  stores.  Few  are  rightly 

*  Bulletin  Bureau  of  Labor  Statistics,  No.  250,  pp.  68-86. 

*  N.  W.  Sheff erman,  Employment  Methods,  1920,  Chap.  XXX. 


WORKING  ENVIRONMENT— WELFARE  WORK  189 

so  named,  as  they  are  mostly  buying  clubs.  The  company 
lends  the  capital  with  which  goods  are  purchased  at  wholesale 
and  sold  at  cost.  This  plan,  however,  has  failed  thousands 
of  times.  It  runs  through  a  regular  course.  The  plan  begins 
with  enthusiastic  support,  then  passes  through  a  period  of 
suspicion  into  one  of  suspended  animation,  and  dies  a  linger- 
ing death;  or  the  company  grows  tired  and  puts  it  out  of  its 
misery.  It  arouses  the  antagonism  of  local  tradesmen,  who 
fight  it  with  sales  of  "leaders"  that  foster  suspicion  that  the 
firm  is  not  playing  fair.  Wholesalers  object  and  will  usually 
raise  prices  to  prevent  sales  at  cost.  Then  the  end  is  close. 

The  only  successful  form  of  co-operation  is  the  old  and 
tested  Rochedale  plan,  under  which  some  of  the  largest  busi- 
nesses in  the  world  are  now  conducted.  Under  this  plan  goods 
are  sold  at  market  rates,  while  the  resulting  profits  are  dis- 
tributed at  regular  intervals  as  dividends  to  buyers  in  propor- 
tion to  their  purchases.  This  plan  starts  slowly,  but  gains 
strength  and  value  with  age.  Its  management  is  entirely  in 
the  hands  of  employees,  and  it  soon  becomes  independent  of 
any  subsidy. 

Future  Field  of  Welfare  Work 

Although  it  has  not  yet  become  a  common  practice  in 
welfare  work,  it  is  probable  that  the  most  fruitful  field  in 
the  future  will  be  co-operation  with  existing  social  agencies. 
Something  has  been  accomplished  in  this  direction  through 
the  Y.  M.  C  A.,  K.  of  C,  Y.  W.  C  A.,  and  similar  or- 
ganizations, but  even  these  organizations  have  shown  a  ten- 
dency to  specialize  as  agents  of  the  employer  rather  than  to 
extend  their  regular  work  among  industrial  employees.  They 
are  also  apt  to  practice  an  aggravating  sort  of  "glad-hand 
paternalism"  that  arouses  resentment.  The  fundamental  wel- 
fare work  must  be  done  through  such  established  public  insti- 
tutions as  schools,  libraries,  social  centers,  neighborhood 


19°  PERSONNEL   RELATIONS   IN   INDUSTRY 

associations,  etc.  Co-operation  with  organizations  for  com- 
munity music,  play,  and  education  in  public  social  centers  is 
of  more  value  than  purely  plant  organizations.  Full  utiliza- 
tion of  public  library  facilities,  including  the  package  libraries 
now  so  generally  available,  supplemented  by  a  special  tech- 
nical plant  library,  touches  deeper  and  more  fundamental 
human  instincts  and  insures  a  wider  response  than  any  purely 
plant  activity.23 

Firm  influence  in  furthering  improved  housing,  paving, 
sewage,  lighting,  school,  and  amusement  facilities  in  the  plant 
neighborhood  lays  the  basis  for  real  solidarity  of  action.  The 
average  plant  owner  and  most  of  the  executive  force  live 
remote  from  the  factory,  in  pleasant,  residence  districts. 
They  concern  themselves  little  with  plant  surroundings  unless 
to  fight  improvements  that  would  raise  taxes  in  the  locality 
where  their  wealth  is  produced.  The  firm  that  recognizes  its 
power  and  duty  to  build  up  the  neighborhood  where  its  plant 
is  located,  and  to  contribute  to  better  housing,  public  service, 
and  amusement  facilities  in  co-operation  with  its  employees, 
will  lay  a  stronger  and  deeper  foundation  for  industrial  good- 
will than  it  would  if  many  thousands  of  dollars  were  invested 
in  ordinary  welfare  work. 

The  effect  of  welfare  work  in  arousing  industrial  good- 

9  "A  government  investigation  published  in  1919  showed  that  57  es- 
tablishments, in  which  employers  paid  all  expenses,  had  nearly  100,000 
volumes  in  their  libraries  at  the  disposal  of  approximately  210,000  em- 
ployees. Libraries  containing  from  a  few  hundred  to  many  thousand 
volumes  are  maintained  by  boot  and  shoe  factories,  clothing  and  furnish- 
ing establishments,  foundries  and  machine  shops,  public  utilities  (gas, 
electric  light  and  power),  iron  and  steel  mills,  coal  mines,  printing  and 
publishing  plants,  stores,  and  rubber  goods  factories.  While  books  are 
usually  furnished  by  the  employer,  they  are  occasionally  provided  by 
the  employees'  clubs.  Another  method  of  securing  books,  frequently  used, 
is  by  cooperation  with  the  local  public  library,  which  in  many  cases  has 
established  branches  in  factories,  or  taken  orders  for  books  to  be  de- 
livered the  next  day.  Some  plants  make  use  of  traveling  collections  of 
books  furnished  by  the  state." — Industrial  Information  Service,  Apr.  I, 
1920,  p.  12.  For  bibliography  and  discussion  of  plant  libraries,  see 
Special  Libraries,  Oct.  1919. 


WORKING  ENVIRONMENT— WELFARE  WORK          IQ1 

will  depends  upon  the  depth,  width,  and  indirection  of  the 
appeal;  the  number  of  instincts  to  which  appeal  is  made; 
the  extent  to  which  co-operation  displaces  paternalism;  and 
the  extent  to  which  science  and  not  sentimentality  rules.  The 
welfare  work  of  the  future  must  be  directed  by  trained  scien- 
tists, thoroughly  familiar  with  the  natural  laws  of  fatigue, 
health,  labor,  and  leisure.  They  must  know  the  best  standards 
of  plant  practice  in  every  direction,  must  be  skilled  in  co-opera- 
tive leadership,  and  schooled  in  the  knowledge  of  the  working 
of  those  deep-lying  instincts  upon  which  human  nature  is 
built. 


CHAPTER  XII 

THE   WAGE   RELATION 

Fossilized  Wage  Theories 

While  it  is  no  longer  true  that  the  only  tie  holding  together 
the  elements  of  industry  is  Carlyle's  ."cash  nexus,"  yet  the 
wage  relation  is  still  fundamental.  It  is  the  point  around 
which  the  hottest  conflict  will  always  rage.  The  wage  system 
makes  the  division  of  the  industrial  profit  a  question  of  rela- 
tive strength;  hence  the  difficulty  of  fixing  any  rules  for  that 
division. 

Political  economists  have  evolved  and  discarded  many 
wage  theories,  most  of  which  are  of  but  incidental  interest 
in  practical  employment  work.  Only  as  these  have  been 
deposited  in  the  geological  layers  of  "common  sense"  and  then 
dug  up,  fossilized,  to  be  used  as  weapons  in  discussion,  have 
they  become  of  interest.  One  of  these  theories  which  has 
been  especially  useful,  or  at  least  has  been  much  used  for 
argumentative  purposes,  is  the  wage-fund  theory,  best  stated 
by  John  Stuart  Mill,  easily  the  foremost  economist  of  the 
middle  years  of  the  nineteenth  century.  Mill,  in  a  famous 
controversy  with  Thompson,  repudiated  his  own  theory  and 
admitted  himself  defeated  in  the  argument,  but  his  repudiation 
did  not  prevent  the  use  of  his  theory  for  many  years  after- 
wards. Indeed,  it  is  still  quite  frequently  found  as  the  half- 
understood  working  hypothesis  of  much  of  the  current  dis- 
cussion of  the  wage  relation. 

The  wage-fund  theory — to  state  it  briefly  and  somewhat 
crudely — holds  that,  in  the  process  of  production,  a  certain 
definite  fund  is  almost  automatically  set  aside  for  wages.  This 

192 


THE  WAGE   RELATION  IQ3 

sum,  the  theory  teaches,  cannot  be  increased  or  diminished 
by  any  human  action,  and  least  of  all  can  it  be  affected  by 
any  action  of  the  wage-earners  through  organization.  There- 
fore the  first  use  of  this  theory  in  popular  wage  discussion 
was  to  prove  the  hopelessness  of  labor's  organizing  to  increase 
wages. 

When  unions  did  very  plainly  raise  wages  and  prove  the 
theory  false,  it  was  not  discarded,  but  on  the  contrary  was 
promptly  imputed  to  the  wage-earners  themselves  as  a 
motive  for  restricting  production.  The  opponents  of  organized 
labor  now  charge  that  unionists  act  upon  the  wage- fund  theory 
and  seek  to  restrict  production  for  fear  there  will  not  be 
work  enough  to  go  around.  Of  course  this  theory  has  become 
somewhat  disfigured  in  the  process  of  death,  fossilization,  and 
disinterment  as  a  weapon.  In  the  beginning,  the  theory  held 
that  wages  were  limited;  now  it  is  work.  But  the  theory  is 
equally  false  and  equally  foolish  in  either  case,  and  was  never 
accepted  by  any  spokesman  for  organized  or  unorganized 
labor.1 

Theory  of  Marginal  Utility 

The  Austrian  economists,  Menger,  Boehm-Bawerk,  and 
Von  Wieser,  worked  out  another  theory,  called  the  "marginal 
utility"  theory.  As  this  is  applied  to  wages,  it  may  be  roughly 
stated  to  hold  that  since  a  certain  number  of  persons  are 
absolutely  required  to  produce  a  necessary  supply  of  commo- 
dities, wages  are  fixed  by  the  worker  using  the  poorest 
machinery,  land,  and  methods,  whose  product  is  necessary  to 
the  supply.  Although  this  theory  is  held  in  some  form  or 
other  by  most  orthodox  political  economists  today,  it  probably 
has  little  relation  to  the  facts  and  is  of  little  value  in  practical 
wage  discussions. 


1  Sidney  Webb,  The  Works  Manager  of  Today,  1918,  p.  58. 


194  PERSONNEL   RELATIONS    IN   INDUSTRY 

Another  theory  holds  that  wages  are  fixed  by  the  average 
amount  of  labor  required  to  dig  a  dollar's  worth  of  gold.2 

Wages  and  Standards  of  Living 

The  largely  unexpressed  theory  upon  which  most  of  the 
discussions  of  wages  turn,  is  that  wages  are  fixed  by  bargain- 
ing under  the  influence  of  supply  and  demand.  In  its  original 
form  this  theory  held  that  the  minimum  wage  limit  was  a  sub- 
sistence for  the  worker ;  the  maximum,  the  entire  product.  The 
actual  wage  of  certain  classes  of  labor  was  many  times  pushed 
below  the  minimum  essential  to  even  a  normal  length  of 
physical  existence.  Workers  and  their  children  did  not  sub- 
sist. Their  abnormally  high  death-rate  proved  the  murderous 
character  of  the  minimum.  Surveys  made  by  the  Children's 
Bureau  of  the  United  States  Department  of  Labor  show  that 
in  Johnstown,  Pennsylvania,  "for  all  live  babies  born  in  wed- 
lock the  infant  mortality  rate  is  130.7."  (This  is  the  number 
dying  annually  per  1,000.)  "It  rises  to  255.7  when  the  father 
earns  less  than  $521  a  year  or  less  than  $10  a  week,  and 
falls  to  84  when  he  earns  $1,200  or  more,  or  if  his  earnings 
are  'ample.' '  Identical  results  obtained  through  similar  in- 
vestigations in  Montclair,  N.  J.,  Manchester,  N.  H.,  Water- 
bury,  Conn.,  and  Brockton,  Mass.,  verify  the  conclusions  and 
prove  that  such  wages  are  deadly  to  everything  desirable  in 
society. 

Out  of  various  phases  of  this  wage  bargaining,  a  series 
of  standards  are  being  developed.  In  many  cases  these  are 
crystallizing,  first  into  custom,  then  sometimes  into  law,  and 
are  backed  by  an  ever-growing  force  of  public  opinion.  These 
standards  are  setting  limits  to  pure  bargaining.  They  are 
narrowing  the  operation  of  the  principle — or  the  custom — of 
wage  determination  by  fighting  strength. 


1  Bulletin  of  Taylor  Society,  Jan.  1915,  p.  I. 


THE  WAGE   RELATION  195 

Standard  Minimum  Budget 

The  minimum  wage  is  becoming  more  definite.  It  is  no 
longer  being  determined  only  by  post-mortem  examinations 
of  death-rates  and  statistics  of  sickness  and  pauperism.  It 
is  being  fixed  in  advance  by  standard  budgets.  The  technique 
of  fixing  budgets  was  first  worked  out  by  a  long  series  of 
minute  studies  for  philanthropic  organizations,  then  for  public 
and  private  institutions,  and  finally  to  fix  legal  minimum 
wages  for  women.  Such  methods  have  been  used  in  so 
large  a  number  of  wage  disputes  that  their  employment  may 
now  be  considered  a  standardized  practice.  It  is  noteworthy 
that  the  standard  minimum  budget  is  constantly  rising  in 
accordance  with  a  constantly  increasing  production  and  gen- 
eral rise  in  the  standard  of  living.  Whereas  the  first  standards 
provided  only  for  bare  physical  subsistence,  it  is  now  felt  that 
any  standard  that  does  not  provide  for  good,  productive  citi- 
zenship is  not  socially  desirable. 

High  Cost  of  Low  Wages 

More  and  more  we  are  coming  to  see  that  the  maximum 
wage  also  will  constantly  rise,  and  that  it  will  probably  reach 
heights  not  now  thought  possible.  The  maximum  is  fixed 
by  the  amount  produced,  less  the  sum  required  to  induce  the 
investment  of  capital  and  the  various  necessary  overhead  ex- 
penses. Recently  accountants  have  been  looking  very  closely 
into  the  nature  and  necessity  of  some  of  the  items  in  that 
famous  blanket,  overhead.  Like  charity,  it  covers  a  multitude 
of  sins  of  management. 

The  substitution  of  knowledge  for  guesswork  in  manage- 
ment is  teaching  that  there  is  an  economy  of  high  wages  that 
profits  those  who  pay  as  well  as  those  who  receive.  Efficient 
industrial  organizers  know  that  low  wages  do  not  necessarily 
mean  low  cost  of  production.  The  fear  of  competition  from 
low- wage  industries  and  countries  is  seen  to  be  largely,  if  not 


I96  PERSONNEL   RELATIONS   IN   INDUSTRY 

entirely,  an  imaginary  bogy.  When  Asiatic  nations  entered 
upon  the  machine  age,  something  like  a  panic  swept  over 
western  nations.  It  was  feared  that  the  low  wages  of  India, 
China,  and  Japan  would  enable  those  nations  to  dominate 
the  markets  of  the  world.  We  know  now  that  danger  from 
the  competition  of  these  nations  will  not  be  great  so  long 
as  they  do  pay  such  low  wages.  When  their  wages  reach  the 
western  level,  then  their  production  costs  will  fall  to  western 
standards. 

Wages  are  cheap  or  expensive,  measured  in  production 
costs,  according  to  the  efficiency  they  buy.  An  illustration 
and  explanation  by  William  R.  Basset  helps  to  make  this 
point  clear: 8 

Before  the  war  the  sailors  on  the  Great  Lakes  had 
higher  wages  than  anywhere  in  the  world,  and  yet  the  cost 
per  ton  mile  of  freight  on  the  lakes  was  cheaper  than  any- 
where in  the  world — because  the  boats  and  the  docks  were 
built  to  give  the  largest  possible  turnover  in  cargoes. 


There  is  no  reason  in  the  world  that  a  common  worker 
should  not  make  one  hundred  and  fifty  dollars  a  week — if 
he  does  that  much  work.  And  it  is  the  combined  fault  of 
the  employer  and  the  employee  if  he  does  not  do  that  much 
work.  But  the  fault  of  neither  is  chronic.  If  both  regard 
a  wage  increase  as  something  to  add  to  cost,  and  not  as  a 
step  toward  cheapening  the  product,  then  the  raise  is  wrong. 
Raising  human  costs  to  save  eventual  costs  sounds  para- 
doxical, but  that  is  the  trend  of  scientific  industry,  and 
marks  the  passage  of  the  worker  from  slave  to  fellow- 
artisan  and  of  the  owner  from  blind  to  enlightened  manu- 
facturing. 

The  United  States  Tariff  Board  found  that  "the  labor 
cost  of  making  a  ton  of  news-print  paper  in  the  United  States 


*W.   R.   Basset,   When  the  Workmen   Help  You   Manage,   1919,   pp. 
65,  68. 


THE   WAGE   RELATION  197 

varied  from  $2.19  to  $7.26  per  ton.  The  most  remarkable 
fact  about  it  was  that  the  mills  paying  the  lowest  wages  and 
having  a  twelve  hour  day,  had  a  higher  labor  cost  per  ton 
of  paper  than  those  paying  the  highest  rates  of  wages  and 
having  an  eight  hour  day."  *  The  difference  was  in  efficiency. 
Low  wages  are  the  refuge  and  the  excuse  of  the  lazy  and 
incompetent  manager. 

High  Wages  and  Efficiency 

William  C.  Redfield,  former  Secretary  of  Commerce,  in  his 
book,  "The  New  Industrial  Day,"  gives  page  after  page  of 
illustrations  of  the  high  cost  of  low  wages.  He  finds  that 
this  law  prevails  in  every  industry  and  in  every  section  of 
the  world.  American  railroads  pay  wages  five  times  as  high 
as  those  of  Europe,  are  not  especially  well  managed  as  meas- 
ured by  high  efficiency  standards,  but  carry  freight  at  less 
per  ton  mile.  American  automobile  competition  became  the 
bugaboo  of  the  world  only  after  Henry  Ford  taught  it  this 
lesson  of  the  economy  of  high  wages.  Today,  with  wages 
from  three  to  ten  times  those  paid  to  better  mechanics  in  the 
factories  of  France,  Italy,  and  Great  Britain,  this  country, 
because  of  its  high  wages,  produces  automobiles  at  less  than 
half  the  cost  in  any  of  those  countries.  Because  of  the  lack 
of  skilled  mechanics  and  artistic  craftsmen,  American  auto- 
mobiles are  not  all  of  as  high  technical  grade  as  those  of 
Europe.  This  only  emphasizes  another  defect  in  manage- 
ment— the  lack  of  adequate  technical  training. 

High  Wages  and  Prosperity 

High  wages  provide  a  partial  security  against  panics. 
There  are  more  theories  of  business  cycles  than  of  wages,  but 


*  United  States  Tariff  Board  Report  on  Pulp  and  News-Print  Paper 
Industry,  1911,  p.  39;  quoted  by  N.  I.  Stone  in  Survey,  Feb.  6,  1915,  and 
in  Annals  of  the  American  Academy,  No.  174,  p.  124.  See  also,  The 


I98  PERSONNEL  RELATIONS   IN   INDUSTRY 

they  nearly  all  agree  that  at  least  an  aggravating  cause  of 
depressions  is  the  maladjustment  of  production  to  marketing, 
due  to  the  difference  between  the  purchasing  power  of  labor 
measured  by  wages  and  the  productive  power  measured  by 
output  High  wages  help  to  adjust  this  discrepancy.  A  10 
per  cent  increase  in  wages  in  the  United  States  adds  a  larger 
"foreign  market"  than  is  now  furnished  by  all  the  nations 
with  which  we  trade.  Moreover,  it  is  the  stupendous  home 
market,  with  its  vast  uniform  demand,  that  called  forth  the 
system  of  standardized  production  upon  which  any  superiority 
that  American  industry  enjoys  now  rests.  This  point  was 
recognized  by  the  Committee  on  Industrial  Relations  of  the 
Chamber  of  Commerce  of  the  United  States  in  its  report 
issued,  April  16,  1919: 8 

That  wages  should  be  kept  adjusted  to  their  purchasing 
power  is  important  from  another  point  of  view.  Wide 
markets  are  essential  to  industrial  success  where  industrial 
achievement  is  in  great  output  at  low  cost.  Such  markets 
are  created  by  workers  as  consumers.  The  great  domestic 
markets  of  the  United  States  are  made  by  the  workers. 
Per  capita  they  consume  more  of  the  products  of  industry, 
and  in  greater  variety,  than  the  people  of  any  comparable 
country.  When  industry  itself  is  based  upon  the  ability  of 
wage-earners  to  buy  its  products,  it  is  dependent  upon  the 
purchasing  power  of  the  wage  being  unimpaired.  An  abun- 
dance of  consumable  articles  with  purchasers  ready  to 
acquire  them  brings  prosperity. 

Constantly  rising  wages  demand  ever-increasing  efficiency 
on  the  part  of  the  worker,  based  on  constantly  improving 
opportunity  for  education  and  training.  In  order  to  educate 
himself  and  his  children,  the  worker  needs  ever  higher  wages, 


Wage-Setting  Process,  Federal  Board  for  Vocational  Education,  Bulletin 
No.  44,  passim. 

*  Bulletin  of  Taylor  Society,  Oct.  1919,  p.  31. 


THE   WAGE   RELATION  199 

and  thus  the  cycle  is  completed  and  another  begun.  An  ex- 
ample of  the  operation  of  this  law  was  seen  in  the  almost 
frenzied  rush  to  educational  institutions  during  the  high  wage 
period  of  reconstruction.  For  the  first  time,  all  educational 
facilities  were  utilized  to  more  than  capacity.  Adults  poured 
into  schools,  patronized  extension,  night,  and  correspondence 
departments,  and  grasped  eagerly  at  opportunities  for  plant 
training.  The  receipt  of  high  wages  gave  health,  energy, 
ambition,  and  opportunity  to  gain  power,  to  produce  more, 
and  thus  to  secure  yet  higher  wages. 

Wages  and  Piece-Rates 

Shall  wages  be  paid  by  time  or  piece?  It  is  commonly 
charged  that  labor  always  opposes  piece-wages.  The  truth 
is  that  such  powerful  unions  as  those  of  the  miners  and  cigar- 
makers,  with  several  others,  insist  upon  piece-wages.  There 
is  no  fixed  line  of  division  on  this  question.8  Each  party 
takes  the  position  which  it  believes  will  give  it  the  advantage 
in  a  particular  bargain.  In  most  of  the  metal-working  trades, 
and  in  such  machine  industries  as  are  subject  to  rapid  change 
in  methods,  labor  objects  to  piece-rates  and  employers  seek 


*  "It  is  often  assumed  that  workmen,  and  especially  Trade  Unionists, 
object  to  piecework.  So  far  is  this  from  being  the  case  that  the  average 
workman  usually  prefers  to  get  the  chance  of  working  by  the  piece,  and, 
apart  from  transport  services,  and  the  general  labourers,  a  majority  of 
the  Trade  Unions  in  Great  Britain  absolutely  insist  upon  this  method 
of  remuneration.  Nor  is  it  true  that  employers  invariably  desire  to  pay 
by  the  piece.  .  .  .  However,  it  is  quite  true  that,  in  the  engineering, 
building,  and  woodworking  trades,  or  at  least  in  most  of  their  branches, 
the  employers  and  managers  have  not  yet  invented  any  system  of  Pay- 
ment by  Results  which  the  great  majority  of  the  British  workmen  will 
agree  to  accept. 


"What  the  instructed  workman  and  the  properly  led  Trade  Union 
object  to  is  not  piecework  as  such,  or  any  other  form  of  Payment  by 
Results,  but  every  such  system  that  is  unaccompanied,  not  only  by  an 
accurate  equivalence  of  the  basic  'Standard  Time'  with  the  Standard 
Time  Rate,  but  also  by  quite  definite  security  for  the  future  maintenance 
of  the  standard  rate  of  remuneration  for  effort." — Sidney  Webb,  The 
Works  Manager  of  Today,  1918,  pp.  56-58,  62.  (Italics  in  original.) 


200  PERSONNEL   RELATIONS   IN   INDUSTRY 

to  install  them.  The  reasons  are  peculiar  to  these  industries. 
The  conditions  of  production  are  only  partially  under  the 
control  of  the  worker,  far  less  than  in  those  trades  where 
there  is  a  remnant  of  handicraftsmanship,  as  in  cigar-making. 
It  is  difficult  to  fix  a  standard.  It  is  easy  to  cut  rates.  Of 
course  some  employers  insist  that  they  never  cut  rates.  To 
such  as  these  the  following  statement  of  John  R.  Commons, 
showing  the  absolute  impossibility  of  avoiding  rate-cutting, 
is  respectfully  recommended:  7 

Piece-rates  must  be  cut  sooner  or  later,  or  else  either 
industry  will  stagnate,  or  wage-earners  will  get  all  of  the 
gain  from  improvements  and  none  will  go  to  the  consumer 
and  the  employer,  or  else  the  employer  will  be  driven  out 
of  business  by  competition.  Piece-rate  cutting  is  universal. 
What  is  meant  when  it  is  denied  is  perhaps  that  the  cutting 
is  not  done  arbitrarily.  This  is  a  question  of  fact,  of  defini- 
tion, of  opinion.  The  cutting  must  be  done — the  question  is 
how,  and  how  often. 

There  is  no  answer  to  this  argument.  Progress  is  cer- 
tainly inevitable  and  desirable  in  invention  and  industry,  but 
its  effects  must  be  shared  by  the  whole  community.  The 
answer  usually  made  to  the  above  argument  is  that  a  new 
process,  machine,  or  change  in  method  requires  the  setting 
of  a  "new"  rate  and  not  the  cutting  of  the  previous  one.  The 
distinction  is  too  fine  to  be  readily  appreciated  by  the  work- 
man who  makes  the  improvement.  Nevertheless  it  is  one 
that  must  be  made,  and  scientific  management,  as  we  shall 
shortly  see,  makes  its  plea  for  consideration  largely  on  the 
ground  of  its  ability  to  draw  such  a  line  of  distinction. 

In  a  changing  industry,  the  worker  feels  that  the  ability 
arbitrarily  to  set  and  cut  piece-rates  is  vested  so  largely  in 


TJohn  R.  Commons,  Industrial  Goodwill,  1919,  p.  8.    Italics  in  original. 


THE  WAGE   RELATION  2OI 

the  employer,  and  so  often  used,  that  it  gives  him  an  unfair 
advantage  in  the  wage  bargain.8 

Objection  to  Payment  by  Results 

There  is  also  a  largely  unexpressed  feeling  among  workers 
that  payment  by  results  is  destructive  of  that  group  solidarity 
which  is  really  so  essential  to  industry  and  to  the  social  wel- 
fare. This  position  is  set  forth  by  John  A.  Hobson  in  far 
plainer  language  than  any  spokesman  for  labor  has  ever 
stated  it :  * 

The  fundamental  assumption  of  the  Labor  Movement, 
in  its  demands  for  reformed  remuneration,  is  that  the 
private  human  needs  of  a  working  family  should  be  regularly 
and  securely  met  out  of  weekly  pay.  The  life  and  the  health 
of  the  family,  and  that  sense  of  security  which  is  essential 
to  sound  character  and  regular  habits,  to  the  exercise  of 
reasonable  foresight,  and  the  formation  and  execution  of 
reasonable  plans,  all  hinge  upon  this  central  demand  for  a 
sufficiency  and  regularity  of  weekly  income  based  upon  the 
human  needs  of  a  family. 

This  explains  alike  the  working-class  objections  to  piece- 
work, the  demand  for  a  minimum  wage,  and  policy  of  limita- 
tion of  individual  output.  For  piece-work,  even  more  than 
time-work  is  based  upon  a  total  ignoring  of  the  human 


*  "It  must  be  remembered  that,  even  where  the  workmen  have  learned 
to  trust  the  present  principals  in  an  establishment,  who  promise  them 
that  rates  shall  never,  under  any  circumstances,  be  cut,  the  workmen  (a) 
are  never  offered  any  legally  binding  guarantee  to  that  effect  (which 
would,  indeed,  be  almost  impossible  to  contrive),  so  that  there  is  no 
assurance  that  the  employer  may  not  subsequently  change  his  mind;  (b) 
are  not  afforded  any  opportunity  of  controlling  or  even  of  verifying  the 
basis  on  which  the  changing  rates  are  from  time  to  time  actually  com- 
puted— a  position  of  helplessness  in  which  the  employer  would  never 
dream  of  placing  himself  with  regard  to  the  most  reputable  and  most 
trustworthy  contractor  for  materials;  and  (c)  are  offered  no  protection 
for  the  future  maintenance  of  the  rates  in  the  event  of  a  change  of  man- 
agement or  proprietorship,  perhaps  the  merger  of  the  firm  in  a  giant 
concern  which  is  known  to  make  a  practice  of  rate-cutting." — Sidney 
Webb,  The  Works  Manager  of  Today,  1918,  p.  71. 

'  J.  A.  Hobson,  Work  and  Wealth,    1914,  pp.  192,  193. 


202  PERSONNEL   RELATIONS   IN   INDUSTRY 

conditions  which  affect  the  giving  out  of  labor  power.  It 
is  the  plainest  and  most  logical  assertion  of  the  commodity 
view  of  labor,  the  most  complete  denial  that  the  human 
needs  of  the  worker  have  any  claim  to  determine  what  he 
should  be  paid. 

So  firmly  rooted  in  the  breast  of  the  ordinary  non- 
working  man  and  of  many  working  men,  is  the  notion  that 
a  man  who  has  produced  twice  as  large  an  output  as  another 
man,  ought,  as  a  simple  matter  of  right  or  justice,  to  receive 
a  payment  twice  as  large,  that  it  is  difficult  to  dislodge  it. 
It  represents  the  greatest  triumph  of  the  business  point  of 
view  over  humanity.  If  a  man  has  done  twice  as  much, 
of  course  he  ought  to  receive  twice  as  much !  It  seems  an 
ethical  truism.  And  yet  I  venture  to  assume  that  it  has 
nothing  ethical  in  it.  It  has  assumed  this  moral  guise 
because  of  a  deep  distrust  of  human  nature  which  it  ex- 
presses. How  will  you  get  a  man  to  do  his  best  unless  you 
pay  him  according  to  the  amount  he  does?  It  is  a  purely 
practical  consideration  that  has  imposed  upon  the  piece-work 
system  the  appearance  of  axiomatic  justice. 

It  is  not  difficult  to  strip  off  the  spurious  ethics  of  the 
principle.  You  say  that  piece-wages  or  payment  by  result 
is  right  because  it  induces  men  to  do  their  best.  But  what 
do  we  mean  by  "doing  their  best"?  A  weak  man  may  hew 
one  ton  of  coal  while  a  strong  man  may  hew  two.  Has  not 
the  former  "done  his  best"  equally  with  the  latter?  The 
strength  of  a  strong  man,  the  natural  or  even  the  acquired 
skill  of  a  skilful  man,  cannot  be  assumed  as  personal  merit 
which  deserves  reward  in  the  terms  of  payment.  If  there 
is  merit  anywhere,  it  is  in  the  effort,  not  in  the  achievement1 
or  product,  and  piece-wages  measure  only  the  latter. 

No !  there  is  nothing  inherently  just  in  the  piece-wage 
system.  Its  real  defense  is  that  it  is  the  most  practical 
way  of  getting  men  to  work  as  hard  as  they  can :  it  is  an 
effective  check  on  skulking  and  sugaring.  It  assumes  that 
no  other  effective  motive  can  be  made  operative  in  business 
except  quantity  of  payment. 

The  application  of  the  point  of  view  which  Hobson  sets 
forth  would   require  a  fundamental  transformation   of  the 


THE   WAGE   RELATION  203 

entire  system  of  personnel  relations  in  industry.  It  would 
seem  to  demand  as  a  prerequisite  an  interest  in  the  work 
itself,  a  thorough  good-will  toward  industry,  and  a  thorough 
understanding  of  reciprocal  duties  in  the  industrial  group.  It 
is  at  least  suggestive  that  the  best  work  of  the  world,  today 
and  always,  has  never  been  paid  on  the  basis  of  measured  and 
immediate  results.  The  physician,  artist,  teacher,  manager — 
indeed  the  whole  class  of  professional  and  managerial 
workers. — are  paid  salaries,  not  wages,  with  more  than  the 
day  as  a  unit  and  with  results  measured  by  long-time 
standards. 

Standards  for  Wage  Determination 

The  opposition  to  piece-wages  is  not  confined  to  idealists, 
economists,  and  certain  trade  unionists.  Harrington  Emer- 
son, one  of  the  best  known  efficiency  engineers,  says : 10 

Piece-wages  are  physiologically  and  equitably  vicious  and 
wrong.  They  put  a  premium  on  harmful  strenuousness,  in- 
stead of  standardizing  working  conditions  and  operations  so 
that  greater  output  will  follow  less  effort,  but  higher  effi- 
ciency per  unit  of  time ;  they  are  based  on  the  assumption 
that  output  is  dependent  on  muscular  energy  as  it  was  in 
former  ages,  instead  of  being  dependent  on  a  steadily  in- 
creasing quantity  of  uncarnate  energy,  combined  with  a 
steadily  decreasing  quantity  of  incarnate  energy,  both 
directed  by  a  steadily  increasing  intelligence. 

Emerson  is  arguing  against  piece-wages  fixed  without 
standard  time,  motion,  and  fatigue  studies.  The  discovery 
and  application  of  the  laws  of  scientific  management  are  crowd- 
ing, one  by  one,  the  methods  of  wage  determination,  based 
upon  rule-of -thumb,  guesswork,  and  strength-testing,  into  a 
narrower  field.  These  methods  have  not  yet  been  eliminated, 


10  Harrington   Emerson,    The    Twelve    Principles   of   Efficiency,    1917, 
p.  225. 


204  PERSONNEL   RELATIONS   IN   INDUSTRY 

but  the  scope  of  their  operation  is  being  encroached  upon  from 
every  side.  It  is  not  alone  that  the  maximum  and  the  minimum 
are  being  more  closely  determined  by  the  publicity  of  more 
accurately  drawn  cost  accounting.  Within  this  narrowing 
field  of  bargaining,  facts,  tested  and  standardized,  are  being 
substituted  for  guesses,  and  careful  weighing  of  evidence  for 
crude  conflicts  of  strength.  Employers  and  labor  organiza- 
tions make  elaborate  investigations  of  standards  of  living  and 
movements  of  price.  Both  sides  make  ever  more  frequent 
appeals  to  compilations  of  such  statistics  prepared  and  pub- 
lished by  the  United  States  Bureau  of  Labor  Statistics.  In 
some  industries,  joint  arrangements  are  made  for  an  impar- 
tial referee,  who  shall  consider  these  facts  at  regular  intervals 
and  make  decisions  upon  them  according  to  fixed  and  agreed- 
upon  standards  of  judgment. 

Management  versus  Employee  Efficiency 

Two  important  unknown  quantities  appear  in  every  equa- 
tion dealing  with  the  wage  problem.  These  are  the  respective 
contributions  and  capacities  of  the  employer  and  the  employee. 
Powerful  class  interests  have  sought  to  keep  these  quantities 
unknown.  Each  side  prefers  to  fight,  rather  than  submit  the 
truth  concerning  its  claims  to  impartial  judgment.  Some  of 
the  questions  that  must  be  answered  before  an  intelligent 
appraisal  of  these  claims  can  be  made  are:  What  is  the 
standard  of  efficiency?  What  reward  is  necessary  to  secure 
that  accumulation  of  capital  essential  to  the  maintenance  and 
growth  of  industry?  Is  labor  using  the  most  efficient  ma- 
chinery and  methods  of  production?  If  not,  who  is  to  blame 
in  each  instance?  Are  the  employees  producing  to  full  capac- 
ity, consistent  with  the  laws  of  work,  fatigue,  and  health? 
Scientific  management  is  seeking  the  answers  to  these 
questions. 

Contrary  to  the  popular  impression,   scientific  manage- 


THE  WAGE  RELATION  205 

ment  directs  its  sharpest  criticism  against  the  inefficiency  of 
employers.     Harrington  Emerson  declares  that: 

American  organization  for  operation,  whether  govern 
mental  (army,  naval,  civil),  whether  state  or  municipal, 
whether  for  land-railroads  or  ocean-steamboats,  whether 
educational  or  religious,  whether  industrial  or  commercial, 
proves  on  investigation  to  be  inefficient,  often  disgracefully 
so,  the  efficiency  of  the  output  of  men  of  militia  age  of  the 
country  being  not  more  than  5  per  cent,  the  efficiency  of  use 
of  materials  being  not  more  than  60  per  cent,  the  efficiency 
of  equipment  facilities  not  averaging  30  per  cent.  These 
inefficiency  statements  can  be  verified  from  the  facts,  by 
competent  experts,  as  readily  as  an  assayer  can  duplicate 
the  assay  of  an  ore  sample.11 

It  is  this  inefficiency  which  limits  wages.  Until  employers 
are  approaching  100  per  cent  efficiency  in  their  use  of  material, 
machinery,  and  organization,  they  have  no  equitable  grounds 
upon  which  to  reproach  labor  for  failing  to  produce  to  the 
limit 

Scientific  Management  and  Production  Cost 

Scientific  management  rests  upon  the  establishment  of 
standards  and  the  verification  of  facts,  with  their  classifica- 
tion and  analysis,  making  possible  a  prediction  as  to  results. 
This  accuracy  is  what  makes  theory  and  practice  scientific. 

Shorn  of  all  non-essentials,  the  underlying  idea  of  scien- 
tific management  is  the  predetermination  of  results  and  the 
standardization  of  methods  and  conditions.  Instead  of 
working  to  more  or  less  nebulous  ends,  under  scientific  man- 
agement definite  ideals  are  established  and  all  efforts  con- 
centrated toward  the  attainment  of  these  ideals  by  the  adop- 
tion of  standardized  methods.12 

"  Harrington  Emerson,  The  Twelve  Principles  of  Efficiency,  1917,  pp. 
27,  28. 

u  G.  C.  Harrison,  Cost  Accounting  to  Aid  Production,  Industrial  Man- 
agement, Apr.  1919. 


206  PERSONNEL   RELATIONS   IN   INDUSTRY 

Frederick  W.  Taylor  always  insisted  that  scientific  man- 
agement is  primarily  a  mental  revolution  on  the  part  of  both 
employers  and  employees.13  He  held  that  all  else  was  sub- 
ordinate to  the  adoption  of  the  scientific  attitude  of  mind  on 
the  part  of  the  persons  engaged  in  industry.  If  these  persons 
could  only  be  made  to  see  the  possibilities  of  carefully  planned 
utilization  of  all  productive  energies,  there  would  be  little 
left  to  quarrel  over.  Such  a  planned  management  would 
create  so  great  a  product  that  the  ambitions  and  desires  of 
all  concerned  could  be  gratified.14 

Without  accepting  quite  such  an  idealistic  attitude,  it  re- 
mains true  that  scientific  management  makes  possible  such  a 
steady  increase  in  production  as  to  permit  a  constantly  and 
rapidly  improving  condition  of  all  producers,  and  a  continuous 
reduction  in  cost  to  consumers. 

Edward  D.  Jones  enumerates  the  technical  phases  of  scien- 
tific management  as  follows:  15 

i.  The   management   must  be  responsible   for   all   man- 
agerial functions. 


"F.  W.  Taylor,  Government  Efficiency,  Bulletin  of  Taylor  Society, 
Dec.  1916,  p.  16;  Principles  of  Scientific  Management,  pp.  130-132. 

14  "If  you  will  take  the  cost  of  the  raw  materials  and  then  add  to  it 
that  cost  which  is  frequently  called  by  various  names — overhead  expense, 
general  expense;  that  is  the  proper  share  of  taxes,  insurance,  light,  heat, 
salaries  of  officers  and  advertising — and  you  have  a  sum  of  money.  Sub- 
tract that  sum  from  the  selling  price,  and  what  is  left  over  is  called 
the  surplus.  It  is  over  this  surplus  that  all  the  disputes  in  the  past 
have  occurred.  The  workman  naturally  wants  all  he  can  get.  His  wages 
come  out  of  that  surplus.  The  manufacturer  wants  all  he  can  get  in  the 
shape  of  profits,  and  it  is  from  the  division  of  this  surplus  that  all  the 
labor  disputes  have  come  in  the  past — the  equitable  division.  The  new 
outlook  that  comes  under  scientific  management  is  this :  The  workmen, 
after  many  object  lessons,  come  to  see,  and  the  management  comes  to 
see  that  this  surplus  can  be  made  so  great,  providing  both  sides  will  stop 
their  pulling  apart,  will  stop  their  fighting  and  push  as  hard  as  they  can 
to  get  as  cheap  an  output  as  possible,  that  there  is  no  occasion  to  quarrel. 
Each  side  can  get  more  than  ever  before.  The  acknowledgment  of  this 
fact  represents  a  complete  mental  revolution." — F.  W.  Taylor,  Govern- 
ment Efficiency,  Bulletin  of  Taylor  Society,  Dec.  1916. 

WE.  D.  Jones,  Administration  of  Industrial  Enterprises,  1916,  p.  135. 


THE   WAGE   RELATION  207 

2.  An  increased  administrative  staff  must  be  provided,  to 
perform  the  wide   range  of   functions  connected   with  the 
planning  and  the  supervision  of  performance. 

3.  Planning  should  be  carried  on  in  advance  of,  and  dis- 
tinct from,  performance. 

4.  A  new  group  of  standards  should  be  formulated  for 
the  control  of  the  conditions  of  equipment,  and  the  regula- 
tion of  the  time,  place  and  manner  of  performance.   Standard 
times  involve  a  schedule  of  events.    A  schedule  necessitates 
systematic  routing,  so  that  the  whereabouts  of  the  work  may 
be  known  at  all  times.    These  standards  should  result,  finally, 
in  the  assignment  to  each  person  daily  of  a  definite  and 
clearly  circumscribed  task. 

5.  Select  persons  who  possess  special  aptitudes  for  the 
task  assigned  to  them. 

6.  Individualize    records    of    performance,    and    furnish 
prompt  information  as  to  results. 

7.  Remuneration  should  be  in  accordance  with  individual 
performance. 

Time  and  Motion  Study 

When  all  possible  has  been  done  to  insure  the  maintenance 
of  high  standards  of  efficiency  in  the  use  of  machinery,  plan- 
ning of  work,  routing  of  material,  adjustment  of  departments, 
and  organization  of  management,  the  next  step  is  to  consider 
the  task  and  reward  of  the  individual  employee.  This,  the 
most  talked  about  phase,  involves  a  careful  analysis  of  the 
time  taken  to  make,  in  the  most  effective  way,  the  absolutely 
necessary  motions  required  for  the  work.  Such  analysis  in- 
volves much  more  than  merely  standing  by  a  workman  with 
a  stop-watch  and  noting  how  long  it  takes  him  to  do  a  certain 
job,  and  then  using  these  figures  to  set  a  rate.  This  is  done 
in  thousands  of  plants  under  the  name  of  "time  and  motion 
study."  Yet  it  has  no  more  to  do  with  scientific  management 
than  physiognomy  and  phrenology  have  to  do  with  scientific 
selection  of  workers. 

Proper  time  and  motion  study  requires  that  each  motion 


208  PERSONNEL   RELATIONS   IN   INDUSTRY 

be  analyzed  into  its  simplest  elements,  and  the  time  necessary 
for  its  performance  should  be  carefully  measured.  This  may 
require  the  use  of  a  motion  picture  camera,  or  other  method 
of  measuring  motions  much  more  accurately  and  rapidly  than 
is  possible  with  a  stop-watch.  A  good  workman  will  make 
many  motions  more  quickly  than  an  observer  can  stop  and 
start  a  stop-watch.  A  rapid  typist  will  make  a  half  dozen 
motions  in  a  fraction  of  a  second. 

When  such  measurements  of  elementary  motions  have 
been  made,  the  combination  into  a  completed  process  is  care- 
fully studied,  to  ascertain  what  motions  may  be  omitted  or 
shortened,  and  the  resulting  conclusion  is  subjected  to  experi- 
ment in  actual  work.  The  best  method  is  then  taught  to  the 
entire  force,  allowances  are  made  for  fatigue,  and  the  rate  is 
fixed  in  accordance  with  the  ascertained  productive  power. 
In  practice,  a  certain  rate  of  wages  is  taken  as  a  "base  rate," 
and  is  guaranteed  to  all  workers.  Then  there  are  various 
systems  of  bonus  payments  for  those  who  reach  or  exceed  the 
rates  fixed.18 

Efficiency  versus  Strenuousness 

All  writers  on  scientific  management  are  unanimous  in 
their  assertion  that  the  task  fixed  must  not  be  one  that  will 
wear  out  the  worker.17  Norris  A.  Brisco  thus  contrasts  effi- 
ciency and  strenuousness: 18 


MH.   S.   Person,   Scientific  Management,  Bulletin  of  Taylor   Society, 
Oct.  1919,  article  prepared  for  Encyclopedia  Americana. 

r"The  primary  object  of  scientific  methods  of  management  is  to  in- 
crease the  productive  capacity  of  a  man  or  a  machine,  to  reduce  eventually 
the  cost  of  the  product  to  the  consumer,  and  at  the  same  time  to  increase 
the  remuneration  of  the  worker.  This  must  be  accomplished  not  by 
mere  speeding  up.  It  must  be  done  by  so  arranging  the  work  of  the 
man  as  to  eliminate  the  unnecessary  operation  and  the  waste  time  and 
teach  him  to  perform  each  necessary  operation  in  the  best  manner  pos- 
sible."— S.  E.  Thompson,  Time  Study  and  Task  Work  Explained,  in 
Business  Statistics,  edited  by  Melvin  T.  Copeland,  1917,  p.  443. 

"N.  A.  Brisco,  Economics  of  Efficiency,  1914,  pp.  37,  38. 


THE  WAGE  RELATION  209 

Strenuousness  and  efficiency  are  not  synonyms,  but  are 
antagonistic  in  meaning.  The  former  stands  for  the  putting 
forth  of  extra  effort,  while  the  latter  stands  for  conservation 
of  human  energy.  Strenuousness  overtaxes  the  strength,  but 
efficiency  conserves  it.  The  former  brings  greater  results 
with  greater  efforts,  while  the  latter  brings  greater  results 
with  lessened  efforts,  through  the  elimination  of  unnecessary 
movements  and  the  proper  direction  of  energy.  The  effi- 
ciency pace  is  one  which  the  worker  can  maintain  from  day 
to  day  without  extra  physical,  mental  or  nervous  strain.  It 
is  the  pace  of  continuous  work,  and  the  one  which  does  not 
overtax  strength  or  impair  health.  The  strenuous  pace  is 
the  spurt  of  a  short  time,  which  cannot  long  be  maintained 
without  causing  an  extra  strain  upon  the  human  system, 
undue  fatigue,  and,  if  continued,  impaired  health. 

Unfortunately  this  standard  has  often  been  neglected  in 
practice.  Mere  pace-making  has  frequently  been  indulged  in 
under  the  disguise  of  scientific  management.  The  result  was 
the  antagonizing  of  labor  and  a  heavy  setback  to  scientific 
methods.  When  the  co-operation  of  labor  is  secured  at  every 
point  (and  there  can  be  no  scientific  time  and  motion  study 
without  such  whole-hearted  co-operation),  and  when  labor  has 
an  equal  voice  in  fixing  tasks  and  rates,  labor  is  showing  a 
full  appreciation  of  the  value  of  scientific  management18 

Base  Rate  and  Bonus  Systems 

When  the  task  has  been  determined  by  exact  measure- 
ments and  tested  standards,  the  problem  once  more  recurs 
of  the  fixing  of  wages.  The  early  exponents  of  scientific 
management,  in  spite  of  all  their  protestations  of  accuracy 
and  their  really  valuable  contributions,  still  did  much  guessing. 
The  very  base  rate  upon  which  all  their  calculations  rested 
was  admittedly  only  the  customary  rate.20  The  study  of 


18  J.  W.  Love,  Teamwork  in  Cleveland  Garment  Industry,  Survey,  Apr. 
3,  1920,  p.  24.     See  also  p.  312. 

""Positive  management  accepts  the  wage  current  in  the  community 


210  PERSONNEL   RELATIONS   IN   INDUSTRY 

budgets  and  standards  of  living,  already  fully  discussed,  make 
possible  the  application  of  scientific  methods  to  the  determina- 
tion of  this  base.  It  must  henceforth  be  the  minimum  essen- 
tial to  the  maintenance  of  a  proper  citizenship.  Upon  such 
a  foundation  it  will  then  be  possible  to  discuss  the  erection  of 
bonus  systems. 

Though  there  are  a  great  variety  of  these  bonus  systems,31 
they  are  all  based  upon  one  general  plan.  All  guarantee  the 
base  rate  to  all  who  are  employed.  Each  worker  is  then  given 
a  bonus  for  all  production  above  this,  according  to  a  rate 
based  upon  the  proper  daily  task  as  determined  by  time  and 
motion  study.  He  is  also  given  all  possible  assistance,  through 
instruction,  routing  of  work,  etc.,  in  securing  this  bonus.  In 
the  original  plan,  the  bonus  was  paid  only  for  quantity.  Closer 
analysis  showed  that  quantity,  even  with  the  best  possible 
management,  is  still  not  entirely  under  the  control  of  the 


as  its  basic  wage,  and  so  long  as  general  conditions  remain  substantially 
the  same,  considers  that  this  wage  should  be  paid  uniformly  to  all  work- 
men for  an  ordinary  day's  work.  Some  of  its  practitioners  may  question 
theoretically  the  justice  of  these  rates.  While  their  theories  have  not 
been  apparently  thoroughly  reasoned  out,  nor  stated  with  any  great  clear- 
ness, there  appears  to  be  among  them  a  feeling  that  basic  rates  should 
be  related  to  each  other  in  proportion  to  the  disagreeableness,  sacrifice, 
or  'cost*  of  different  occupations,  scientifically  determined.  One  pro- 
poses that  this  determination  shall  be  made  upon  the  basis  of  foot- 
pounds of  energy  expended,  another  on  the  relative  total  disagreeable- 
ness  or  irksomeness  of  jobs.  These  theories  are  not  pressed  very  in- 
sistently, however,  nor  is  there  much  tendency  to  question  the  justice 
of  current  rates.  On  the  whole  they  are  felt  to  depend  upon  some  rather 
hazy  law  of  'supply  and  demand' ;  and  in  any  case  the  validity  of  this 
law,  if  there  is  any,  is  outside  the  practical  scope  of  a  scientific  manager's 
business.  He  accepts  current  wages  as  they  are,  as  the  basis  on  which 
to  build  a  differential  payment  for  differences  in  ability." — G.  B.  Thomp- 
son, Relation  of  Scientific  Management  to  Labor,  Quarterly  Journal  of 
Economics,  Feb.  1916,  p.  145 ;  R.  F.  Hoxie,  Scientific  Management  and 
Labor,  1915,  pp.  63,  64;  The  Wage-Setting  Process,  Federal  Board  for 
Vocational  Education  Bulletin  No.  44,  pp.  13,  14. 

21  For  description  of  various  systems  see  E.  D.  Jones,  Administration 
of  Industrial  Enterprises,  1916,  Chaps.  XIII,  XIV;  W.  H.  Leffingwell, 
Scientific  Office  Management,  1917,  Chap.  XXIII;  Wage-Setting  Process, 
Bulletin  No.  44,  Federal  Board  for  Vocational  Education,  pp.  23-30. 


THE  WAGE   RELATION  21  r 

employee,  and  that  the  most  careful  time  study  still  left  many 
variable  elements  not  calculated.22 

Emphasis  on  Quality  Production 

On  the  other  hand,  quality  is  determined  to  a  far  greater 
extent  by  the  employee.  Quality  also  appeals  to  the  instinct 
of  craftsmanship.  Bonus  for  quality  has  less  of  the  appear- 
ance of  rushing  and  grasping  for  profits.  For  all  these,  and 
some  other  reasons,  there  is  a  decided  tendency  to  transfer 
the  standard  for  the  granting  of  a  bonus  from  quantity  to 
quality.23  It  seems  quite  probable  that  the  best  plan  in  the 
future  will  be  to  give  a  reward  for  both  quantity  and  quality, 
but  to  make  the  quantity  element  less  prominent  in  determin- 
ing the  rate.  It  has  been  found  that  where  quality  is  em- 
phasized, quantity  automatically  increases. 


"R.  F.  Hoxie,  Scientific  Management  and  Labor,  1915,  pp.  40-55, 
discusses  the  lack  of  scientific  accuracy  in  time  and  motion  study  as 
commonly  practiced.  W.  R.  Basset,  When  Workmen  Help  You  Manage, 
1919,  p.  48,  gives  the  following  principles  which  should  govern  any 
bonus  system : 

1.  Extreme  simplicity,  so  that  the  details  may  be  readily  understood 
by  every  worker;  any  element  of  doubt  as  to  fairness   (arising  perhaps 
only  from  lack  of  understanding)  will  kill  co-operation. 

2.  It  must  be  obvious  that  the  reward  is  the   result  of   effort  and 
skill,  and  the  reward  must   follow  with   such   swiftness   in   its   increase 
of  earnings  that  the  effort  and  reward  will  in  effect  be  synonymous. 
A  remote  reward  kills  sustained  effort. 

3.  The  method  must  be  thoroughly  sold  to  the  people;   and  if  the 
method  cannot  be  sold  it  is  bad,  no  matter  how  many  points  of  merit 
in  it  may  appeal  to  the  scientific  mind. 

4.  The  initial  rates  should  be  fixed  in  conjunction  with  a  committee 
of  those  affected,  and  the  basis  should  be  a  scientific  time  study,  every 
point  of  which  is  understood  and  approved  by  the  committee. 

5.  The  initial  rates  should  be  regarded  as  experimental,  and  all  rates 
should  always  be  open  to  easy  revision,  by  and  with  the  committee  on 
rates. 

6.  The   foremen   or   other   officers   directly   in   contact   with   the  job 
should  have  nothing  to  do  with  the  rate-fixing  or  rate-changing,   and 
the  complaints  against  rates  should  be  handed  to  the  committee  and  not 
to  the  foremen.    The  foremen  are  directors  of  work  and  not  of  wages. 

n  S.  E.  Thompson,  in  Bulletin  of  Taylor  Society,  Oct.  1916,  p.  9; 
P.  F.  O'Shea,  Securing  Quality  by  a  Bonus,  Factory,  Dec.  1918,  pp. 
1061-1064. 


212  PERSONNEL   RELATIONS   IN   INDUSTRY 

The  first  exponents  of  the  Taylor  system  were  inclined 
to  lay  all  emphasis  upon  the  quantity  reward  for  a  task  basis.24 
That  the  advocates  of  scientific  management  are  fully  aware 
that  the  best  work  is  not  done  under  such  a  bargain,  is  seen 
in  a  sentence  from  the  report  of  H.  K.  Hathaway,  treasurer 
of  the  Taylor  Society,  defining  the  standard  of  admission  to 
that  society:  "It  is  desirable  to  so  safeguard  membership  as 
to  confine  it  to  those  who  unqualifiedly  stand  for  the  principle 
set  forth  by  Frederick  W.  Taylor — who  are  true  followers 
and  who  conform  to  the  unwritten  code  of  ethics  which  Taylor 
observed  and  wished  his  followers  to  observe :  'I  can  no  longer 
afford  to  work  for  money.' '  It  has  not  always  occurred 
to  all  the  members  of  the  Taylor  Society  that  other  workmen 
might  find  pride  in  producing  for  other  than  money  rewards. 
Recent  proceedings  of  the  society  show  that  the  trend  is  now 
all  away  from  the  original  emphasis  on  a  quantity  bonus.85 

Profit-Sharing  Plans 

For  many  years  employers  have  sought  a  short-cut  to 
industrial  peace  and  efficiency  through  some  form  of  profit- 
sharing.  The  overwhelming  majority  of  these  efforts,  like 
most  others  which  seek  a  way  to  avoid  real  responsibility  and 
careful  planning,  have  failed.  Walter  M.  Polakov,  tells  some 
of  the  reasons  for  these  failures : 26 

Profit  sharing  is  based  on  the  assumption  that  the  em- 
ployees by  their  work  contribute  to  the  success  of  the  enter- 
prise in  securing  profits.  This  would  be  entirely  correct  if 
the  employees  were  given  the  opportunity  to  control  all  the 
functions  of  management,  fix  the  salaries  of  all  directors, 
direct  purchases  and  sales  and  have  the  right  of  veto  in  all 
financial  transactions.  As  long  as  they  are  expected,  how- 

"F.  W.  Taylor,  Principles  of  Scientific  Management,  pp.  33,  34,  1911. 
*  R.  B.  Wolf,  Mechanical  Engineering,  Dec.  1918 ;  also  in  Bulletin  of 
Taylor  Society,  Mar.  1917. 

"Bulletin  of  Taylor  Society,  Jan.  1917. 


THE   WAGE   RELATION  213 

ever,  to  work  under  the  conditions  provided  by  the  manage- 
ment, with  equipment  and  material  furnished  by  the  manage- 
ment, which  in  turn  disposes  of  the  product,  the  profit  or 
loss  is  only  slightly  influenced  by  the  excellence  of  the  work 
done  by  the  men.  Therefore,  if  the  company  earns  large 
dividends,  the  sharing  of  it  with  the  employees  is  but  a 
matter  of  gift  for  the  purpose  of  keeping  peace  with  the 
owner's  conscience,  if  it  is  not  a  plain  case  of  cowardice 
in  anticipation  that  the  men  will  rebel  when  they  learn  how 
small  were  their  wages  compared  with  the  profits  derived 
from  their  toil.  On  the  other  hand,  if  the  dividends  were 
not  declared,  the  workmen  would  lose  their  share,  although 
through  no  fault  of  their  own,  since  they  might  have  been 
working  as  hard  as  possible,  yet  blunders  in  policy  and  man- 
agement ruined  the  business. 

Harrington  Emerson,  after  a  study  of  the  subject,  con- 
cluded that:  "Out  of  the  eighteen  items  of  operating  costs  or 
manufacturing  costs,  as  distinguished  from  selling  costs,  only 
one  is  directly  influenced  by  the  worker,  and  that  is  the  time 
quality  of  his  work.  For  the  other  seventeen  items  the  man- 
agement is  partly  responsible,  but  often  many  of  them  are 
beyond  the  control  of  either  manager  or  worker — the  prices 
of  materials  for  instance.  These  are  often  the  largest  part 
of  the  cost."  He  therefore  concluded  that  "  a  profit-sharing 
plan  is  not  an  efficiency  reward."  " 

In  actual  operation,  a  profit-sharing  plan,  unless  accom- 
panied by  joint  management  and  the  greatest  possible  pub- 
licity, is  much  more  apt  to  breed  suspicion  and  trouble  than 
confidence  and  good-will.  The  employees  have  no  means  of 
knowing  how  efficient  is  the  management;  they  are  not  cost 
accountants,  nor  trained  to  analyze  financial  operations. 
When  profits  cease  to  be  shared  because  of  bad  times,  the 
employees,  who  have  worked  as  hard  as  ever,  are  very  apt 
to  blame  and  distrust  the  management. 


"Harrington   Emerson,    The   Twelve   Principles    of    Efficiency,    1917, 
P-  355- 


CHAPTER  XIII 

LABOR   TURNOVER 

Turnover  as  an  Efficiency  Barometer 

Labor  turnover  is  the  master  test  of  management  Bad 
management  may  show  in  lower  production,  in  deterioration 
of  plant,  in  poor  credit,  or  in  loss  of  good-will.  Any  of 
these  things  might  also  be  due  to  some  other  cause,  but  no 
organization  with  good  management  will  continuously  have 
a  high  percentage  of  labor  turnover.  The  rate  of  turnover 
is  the  barometer  that  tells  whether  hiring,  promotion,  produc- 
tion, and  general  organization  and  direction  of  industry  are 
well  done.  The  time  is  not  far  distant  when  a  high  turnover 
will  be  an  obstacle  to  financing  and  a  cause  for  investigation 
into  the  stability  of  a  firm.1 

Methods  of  Calculating  Labor  Turnover 

The  method  of  calculating  turnover  is  not  yet  well  stand- 
ardized. The  most  common  standard  is  the  one  adopted  by 


1  "From  the  standpoint  of  workmen  as  from  the  standpoint  of  em- 
ployers, the  turnover  is  probably  the  more  important  as  a  symptom  than 
as  a  cost  in  itself.  It  is  a  symptom  of  inefficient  hiring  methods  which 
place  workmen  in  positions  for  which  they  are  unfitted,  or  for  which  they 
are  less  adapted  than  for  other  positions ;  it  is  a  symptom  of  severe  and 
disagreeable  work;  of  bad  working  conditions;  of  piece  rates  below  a 
fair  level;  of  inadequate  methods  of  instructing  workmen  in  the  job  when 
hired ;  of  defective  management,  resulting  in  friction,  inefficiency,  and 
often  open  conflict;  of  lack  of  opportunity  for  workmen  to  advance  on 
the  basis  of  merit;  of  poor  planning  and  organization  of  the  work  in 
individual  establishments  resulting  in  temporary  jobs,  an  unduly  high 
peak  load,  and  an  unduly  low  load;  and  of  lack  of  co-ordination  and 
co-operation  between  industries  whose  slack  and  busy  seasons  dovetail." — 
S.  H.  Slichter,  Turnover  of  Factory  Labor,  1919,  p.  159. 

214 


LABOR  TURNOVER  215 

the  United  States  Labor  Bureau,  and  used  in  the  calculation 
of  all  figures  published  by  the  national  government.  The  rules 
for  this  standard  are  as  follows: 

Labor  turnover  for  any  period  consists  of  the  number 
of  separations  from  service  during  that  period.  Separations 
include  all  quits,  discharges,  and  lay-offs  for  any  reason 
whatever. 

The  percentage  of  labor  turnover  for  any  period  con- 
sidered is  the  ratio  of  the  total  number  of  separations  dur- 
ing the  period  to  the  average  number  of  employees  on  the 
force  during  that  period.  The  force  report  gives  the  number 
of  men  actually  working  each  day  as  shown  by  the  attend- 
ance records. 

It  is  recommended  that  the  percentage  turnover  be  com- 
puted for  each  week.  All  turnover  percentages  for  a  week 
or  for  any  other  period  should  always  be  reduced  to  a 
yearly  basis  and  be  reported  in  terms  of  percentages  per 
annum. 

To  compute  the  percentage  of  labor  turnover  for  any 
period  find  the  total  separations  for  the  period  considered 
and  divide  by  the  average  of  the  number  actually  working 
each  day  throughout  the  period.  Then  multiply  by  the 
proper  factor  to  reduce  to  a  yearly  basis. 

The  formula  under  this  standard  is  as  follows: 

5"=Separations 
^4= Attendance 
T=Turnover 

Then  r=~ 

A 

This  standard  has  been  rather  sharply  criticized,  and  will 
undoubtedly  be  replaced  in  time  with  a  better  one.  In  a  dis- 
cussion in  The  Bulletin  of  the  Taylor  Society,  for  August, 
1919,  a  different  formula  is  proposed. 

Criticism  is  there  made  of  the  use  of  attendance  as  a 


2l6  PERSONNEL    RELATIONS   IN   INDUSTRY 

denominator  in  the  equation,  on  the  ground  that  attendance 
fluctuates  from  day  to  day  because  of  sickness,  temperature, 
holidays,  dissipation,  condition  of  work,  and  various  other 
items ;  that  while  these  causes  should  be  measured  and  mended 
where  possible,  the  problems  they  present  are  not  properly 
considered  under  the  head  of  turnover,  and  therefore 
should  be  treated  separately;  that  accordingly  pay-roll  should 
be  substituted  for  attendance  as  a  divisor.  These  critics  dis- 
approve also  of  the  use  of  separations  as  a  numerator  in  the 
equation.  They  urge  that  separations  in  a  declining  industry 
do  not  measure  changes,  which  is  the  prime  purpose  of  turn- 
over calculations,  but  rather  the  rate  of  decline  in  production ; 
and  accordingly  for  separations  they  would  substitute  replace- 
ments, to  indicate  the  number  which  it  is  necessary  to  hire 
to  maintain  the  force.  So  readjusted,  the  formula  would 
read: 

R 

T— —  with  ^^Replacements,  and  P=Pay-roll 

To  calculate  the  turnover  for  an  extended  period  according 
to  this  formula,  and  to  allow  for  fluctuations  in  production, 
the  elements  of  the  equation  should  be  determined  at  weekly 
intervals  and  the  average  pay-roll  used  as  a  divisor  into  the 
total  number  of  replacements.  The  formula  would  then  read: 


N 

jR=Replacements 

P=Pay-roll 

JV=Number  of  pay-rolls  used2 


*For  discussion  of  computation  of  turnover  see,  The  Turnover  of 
Labor,  Federal  Board  for  Vocational  Education,  Bulletin  No.  46,  pp. 
31-38.  For  method  of  calculation  by  labor  hours  see  P.  F.  Brissenden 
and  Emil  Frankel,  Mobility  of  Labor  in  American  Industry,  Labor 
Review,  June,  1920,  pp.  36-59. 


LABOR  TURNOVER  217 

In  all  cases  the  percentage  should  be  reduced  to  an  annual 
basis  and  so  stated  for  purposes  of  comparison.  If  the  frac- 
tion is  calculated  for  a  week,  for  example,  it  should  be  mul- 
tiplied by  fifty-two.3 

Form  for  Analysis  of  Problem 

Turnover  is  not  a  single  problem,  and  therefore  cannot  be 
solved  by  any  one  panacea.  Analysis  and  diagnosis  must  first 
determine  what  particular  phase  of  the  problem  demands 
treatment.  To  make  this  analysis  automatic  in  the  process 
of  recording,  and  to  insure  uniformity  for  the  purpose  of 
comparison  and  study,  a  standard  blank  has  been  prepared 
by  a  committee  of  the  Boston  Employment  Managers'  Asso- 
ciation and  is  given  herewith. 

The  division  of  "New  Employees"  into  "Experienced," 
"Learners,"  and  "Laborers,"  was  chosen  rather  than  the  terms 
"Skilled"  and  "Unskilled,"  as  admitting  of  more  nearly 
accurate  definition.  An  experienced  worker  is  one  who  has 
worked  at  the  trade  previous  to  entering  the  plant.  A  learner 
has  not  worked  at  the  trade,  but  is  to  be  trained  to  skilled 
work.  A  laborer  expects  to  continue  at  what  is  commonly 
called  unskilled  work. 

Classification  by  such  a  blank  reveals  the  principal  causes 
of  turnover  and  suggests  the  necessary  remedies.  It  always 
shows  certain  classes  furnishing  the  great  mass  of  the  turn- 
over. When  we  say  that  a  plant  has  a  turnover  of  150  per 
cent,  what  we  really  mean  is  something  like  this:  The  male 
office  force  has  a  turnover  of  15  or  20  per  cent;  skilled 
workers,  of  perhaps  30  per  cent;  untrained  labor,  200  per 
cent;  and  the  young,  recently  hired,  untrained  workers  500 
per  cent.  The  records  of  the  personnel  department  should 


•For  an  elaborate  discussion  of  the  mathematics  of  turnover  calcu- 
lation see  Carl  Earth,  The  Mathematics  of  Labor  Turnover,  Industrial 
Management,  Apr.  1920,  pp.  315-318. 


218 


PERSONNEL   RELATIONS   IN   INDUSTRY 


LABOR  TURNOVER 


219 


220  PERSONNEL   RELATIONS    IN   INDUSTRY 

show  the  average  length  of  service  of  all  employees  by  months 
for  the  first  year,  and  by  years  thereafter.  Employment  sta- 
tistics should  also  be  classified  as  to  age  and  skill  of  employees, 
and  the  departments  in  which  they  work.  Only  after  such 
an  analysis  do  we  have  the  standardized,  classified  facts  which 
are  the  foundation  of  scientific  treatment. 

Relation  of  Length  of  Service  to  Turnover 

An  investigation  in  Detroit,  conducted  by  the  United 
States  Department  of  Labor,  disclosed  the  following: 

If  a  worker  remains  in  the  factory  three  months  the 
chances  are  two  to  one  that  he  will  be  permanent.  Of  the 
men  hired  in  Detroit,  21  per  cent  leave  their  jobs  before 
they  finish  one  week's  work;  15  per  cent  work  less  than  two 
weeks;  14  per  cent,  less  than  one  month;  17  per  cent,  from 
one  to  three  months;  n  per  cent,  three  to  six  months; 
8  per  cent,  six  months  to  one  year,  and  after  one  year  the 
percentage  decreases  rapidly  from  6  per  cent  quitting  their 
jobs  after  working  less  than  two  years  to  I  per  cent  quitting 
after  being  employed  five  years."  * 

The  methods  of  dealing  with  this  difficulty  have  already 
been  discussed  in  treating  of  the  introduction  of  the  new 
worker  to  industry.  Much  also  depends  upon  the  methods 
of  selection.  If  workers  suited  to  the  position,  and  whom 
the  position  suits,  are  secured,  the  tremendous  waste  of  the 
turnover  of  the  first  few  months  can  be  saved.  When  it  is 
remembered  that  the  labor  of  such  persons  is  sometimes  worse 
than  valueless,  and  in  all  cases  is  of  very  much  less  value 
than  that  of  older,  trained  employees,  it  will  be  seen  that 
there  is  ample  room  for  the  expenditure  of  many  times  the 
sums  now  spent  on  a  personnel  department  before  such  ex- 
pense will  encroach  upon  the  saving  a  reduction  in  this  turn- 
over will  bring. 


4  Quoted  in  Automotive  Industries,  Mar.  20,  1919,  p.  619. 


LABOR   TURNOVER  221 

Problem  of  Unskilled  Labor 

The  next  great  class  revealed  as  responsible  for  turnover 
is  the  unskilled.  A  government  investigation  covering  Cleve- 
land and  Detroit  found  that  "the  almost  unanimous  opinion 
was  that  the  largest  turnover  was  taking  place  in  departments 
predominantly  unskilled,  where  the  bulk  of  the  employees 
were  classed  as  common  labor.  The  least  turnover,  it  was 
reported,  was  taking  place  mainly  'among  the  highly  skilled 
employees  who  were  earning  big  money  and  had  long  records 
of  continuous  service.'  "  5 

Sumner  H.  Slichter  finds  that,  "Analysis  of  the  turnover 
rate  among  different  classes  of  workmen  shows  that  in  general 
there  is  an  inverse  relationship  between  the  degree  of  skill 
and  the  rate  of  turnover.  The  higher  the  degree  of  skill  the 
lower  the  rate  of  turnover.  There  are  exceptions  to  this  rule 
but  in  most  plants  it  holds  true.  Among  skilled  tradesmen 
the  turnover  rarely  runs  above  50  per  cent,  and  indeed  in 
most  cases  is  below  30  per  cent.  Among  common  laborers, 
on  the  other  hand,  the  turnover  is  rarely  below  100  per  cent 
and  is  usually  much  higher."  6 

The  answer  to  this  phase  of  the  turnover  problem  is  simple 
in  statement,  but  slow  and  difficult  of  realization,  namely: 
Abolish  the  unskilled.  The  unskilled  worker  has  no  right  to 
remain  unskilled.  He  should  be  as  promptly  as  possible  trans- 
lated into  a  happier,  more  efficient,  and  socially  more  desirable, 
skilled  worker.  There  are  no  jobs  for  unskilled  workers,  as 
all  jobs  require  some  degree  of  skill.7 

Scientific  management  has  demonstrated  beyond  dispute 
that  there  are  no  unskilled  jobs.  Sometimes  when  a  manager 


*  Borris  Emmet,  Labor  Turnover  in  Cleveland  and  Detroit,  Monthly 
Labor  Review,  Jan.  1919,  p.  29. 

"S.  H.  Slichter,  The  Turnover  of  Factory  Labor,  1919,  p.  57,  et  seq. 

T  S.  H.  Slichter,  The  Turnover  of  Factory  Labor,  1919,  p.  333 ;  John 
Leitch,  Man  to  Man,  1919,  p.  54. 


222  PERSONNEL  RELATIONS   IN   INDUSTRY 

tells  me  that  he  needs  only  unskilled  men  and  women  in  his 
plant,  I  think  there  may  be  one  exception  to  this  rule,  because 
so  many  unskilled  men  are  able  at  least  to  hold,  if  not  to  fill, 
the  position  of  manager.  Frederick  W.  Taylor  made  his  first 
great  contribution  to  management  with  laborers  engaged  in 
picking  pigs  of  iron  from  the  ground,  carrying  them  up  an 
inclined  plane,  and  dropping  them  on  a  flat  car.  His  next 
great  achievement  was  with  gangs  of  shovelers.  In  both  cases 
he  multiplied  productivity,  decreased  the  cost  of  handling,  and 
increased  wages  by  making  the  work  skilled.  In  the  face  of 
this  example,  and  a  multitude  of  similar  results  in  like  lines 
of  work,  the  statement  that  any  job  can  best  be  done  by 
unskilled  labor  is  only  evidence  of  lack  of  good  management. 

Danger  of  Illiteracy 

Closely  analogous  to  the  unskilled  are  the  illiterate  and 
uneducated  workers,  who  everywhere  contribute  largely  to 
turnover.  The  remedy  is  the  same  as  in  the  case  of  the 
unskilled — abolish  illiteracy.  Some  day  industry  will  awake 
to  the  fact  that  it  has  paid  dearly  for  its  neglect  of  the  schools, 
its  failure  to  prevent  illiteracy  among  natives,  and  its  eager- 
ness to  import  millions  of  illiterate  immigrants.  The 
demoralization  of  American  industry  by  these  uneducated 
classes  is  deeper  and  more  far-reaching  than  we  have  hitherto 
realized.  We  are  beginning  to  suspect  that  "cheap  immigrant 
labor"  may  be  the  most  expensive  obtainable  and  the  greatest 
handicap  to  American  industrial  efficiency.  Employers  wel- 
comed it,  in  some  cases,  because  of  its  supposed  ignorance, 
its  submissiveness,  and  lack  of  ambition.  They  are  awaken- 
ing to  find  that  it  has  not  merely  knowledge,  but  also  revolu- 
tionary ambitions  that  threaten  violent  action,  destructive  of 
the  political  democracy  it  does  not  understand,  in  search  of 
relief  from  an  industrial  autocracy  it  believes  unjust. 

We  cannot  meet  this  situation  with  suppression,  denuncia- 


LABOR  TURNOVER  223 

tion,  and  deportation.  It  will  require  a  long  and  expensive 
program  of  education.  It  will  demand  experience  in,  as  well 
as  lectures  on,  democracy.  The  course  that  must  be  taken 
to  meet  the  problem  of  the  uneducated,  native  and  immigrant, 
in  industry  and  society,  involves  an  educational  scheme  of 
great  magnitude.  Such  a  course  must  be  taken;  and  when 
it  has  been  carried  out,  many  problems  besides  the  one  of 
the  contribution  of  the  ignorant  to  industrial  turnover  will 
be  on  the  way  to  solution.  Enough  facts  are  available  to  show 
that  all  the  expense  of  such  a  program  of  education  and  indus- 
trial readjustment  can  easily  be  paid  for  out  of  the  increased 
production  it  will  bring. 

Turnover  of  Youthful  Labor 

Child  labor  is  pre-eminently  floating  labor.  This  is  not 
wholly  bad.  The  year  of  wandering  that  has  traditionally 
followed  apprenticeship  is  a  natural  gratification  of  the  spirit 
of  unrest  in  youth.  Some  of  the  worst  of  the  sins  of  igno- 
rance in  industrial  management,  because  of  the  lives  they  have 
wrecked,  are  due  to  the  lack  of  knowledge  of  the  great  in- 
stincts that  are  struggling  for  helpful  expression  in  youth. 
These  are  set  forth  with  keen  insight  in  Jane  Addams'  "The 
Spirit  of  Youth  and  the  City  Streets."  8 

We  are  told  that  all  the  activities  of  primitive  man  and 
even  those  of  his  more  civilized  successors  may  be  broadly 
traced  to  the  impulsion  of  two  elemental  appetites.  The  first 
drove  him  to  the  search  for  food,  the  hunt  developing  into 
war  with  neighboring  tribes,  and  finally  broadening  into 
barter  and  modern  commerce ;  the  second  urged  him  to 
secure  and  protect  a  mate,  developing  into  domestic  life, 
widening  into  the  building  of  homes  and  cities,  into  the 


"Jane  Addams,  The  Spirit  of  Youth  and  the  City  Streets,  1912.  The 
whole  work  is  especially  valuable  on  this  point.  See  especially  pp.  52, 
53  and  Chap.  V. 


224  PERSONNEL   RELATIONS   IN   INDUSTRY 

cultivation  of  the  arts  and  a  care  for  beauty.  In  the  life 
of  each  boy  there  comes  a  time  when  these  primitive  in- 
stincts urge  him  to  action,  when  he  is  himself  frightened 
by  their  undefined  power.  .  .  . 

To  set  his  feet  in  the  worn  path  of  civilization  is  not 
an  easy  task,  but  it  may  give  us  a  clue  for  the  undertaking 
to  trace  his  misdeeds  to  the  unrecognized  and  primitive  spirit 
of  adventure  corresponding  to  the  old  activity  of  the  hunt, 
of  warfare  and  discovery. 

Modern  machine  industry  is  peculiarly  unfitted  to  gratify 
the  most  pressing  instincts  of  youth.  Physiologists,  psychol- 
ogists, and  pedagogues  agree  that  what  is  demanded  by  the 
whole  nature  of  youth  is  adventure  and  action.  The  great 
muscles  of  the  body  clamor  for  exercise,  and  the  smaller 
muscles  and  finer  nerve  actions  are  not  yet  ready  to  function.9 
Now  it  is  just  these  activities  that  are  neglected  and 
repressed  by  modern  industry.  There  is  little  call  for  adven- 
ture, conquest,  struggle,  personal  achievement,  or  great  motor 
activity  in  the  machine  process.10  If  we  repress  these  instincts 
we  shall  produce  inevitable  and  harmful  reactions  in  the  form 
of  mischievousness,  destructiveness,  wandering,  and  some- 
times serious  crime — social  evils  characteristic  of  this  age. 


*G.  S.  Hall,  Adolescence,  1907,  Vol.  I,  pp.  164,  165. 

10  "Not  only  have  the  forms  of  labor  been  radically  changed  within 
a  generation  or  two,  but  the  basal  activities  that  shaped  the  body  of 
primitive  man  have  been  suddenly  swept  away  by  the  new  methods  of 
modern  industry.  Even  popular  sports,  games  and  recreations,  so  abun- 
dant in  the  early  life  of  all  progressive  peoples,  have  been  reduced  and 
transformed,  and  the  play  age,  that  once  extended  on  to  middle  life 
and  often  old  age,  has  been  restricted.  .  .  .  Our  industry  is  no  longer 
under  hygienic  conditions,  and  instead  of  being  out  of  doors,  in  the 
country,  or  of  highly  diversified  kinds,  it  is  now  specialized,  monotonous, 
in  closed  spaces,  bad  air,  and  perhaps  poor  light,  especially  in  cities.  .  .  . 
Work  is  rigidly  bound  to  fixed  hours,  uniform  standards,  stints  and 
piece-products,  and  instead  of  a  finished  article,  each  individual  now 
achieves  a  part  of  a  single  process,  and  knows  little  of  those  that  pre- 
cede or  follow.  Machinery  has  relieved  the  large  basal  muscles  and  laid 
more  stress  upon  fine  and  exact  movements  that  involve  nerve  strain." — 
G.  S.  Hall,  Adolescence,  1907,  Vol.  I,  p.  166.  The  whole  chapter  is  good 
on  this  point. 


LABOR   TURNOVER  225 

Remedy  for  Youthful  Turnover 

The  remedy  is  to  sublimate  these  instincts  by  directing 
their  expression  into  desirable  channels.  Relations  between 
education  and  production  must  be  so  adjusted  that  there  is 
an  opportunity  for  change,  without  the  destructive  loss  to 
society  and  the  individual  inherent  in  the  present  planlessness. 

The  whole  tendency  of  education  and  industrial  training 
is  now  toward  meeting  this  problem  of  youthful  turnover. 
Individual  industries  can  meet  it  by  approximating  the 
methods  being  worked  out  at  large  in  the  schools.  Training 
systems  giving  opportunity  for  choice  and  change,  with  growth 
clearly  made  evident  and  a  goal,  even  though  it  may  some- 
times change,  clearly  defined  at  each  stage,  offer  the  only 
effective  solution  of  this  phase  of  the  turnover  question. 

Further  Analysis  of  Problem 

Every  analysis  of  turnover  finds  that  it  varies  directly 
with  the  conditions  of  the  work.  Dirty,  dusty,  heavy, 
monotonous,  and  poorly  paid  work  are  all  causes  of  high 
turnover,  and  their  mere  mention  suggests  the  remedy.  Night 
work  always  shows  a  larger  turnover  than  day  work.  It  is 
probable  that  if  this  fact  were  taken  into  consideration,  there 
would  be  many  instances  where  continuous  operation  would 
prove  less  profitable  than  is  thought.11 

"This  table  clearly  shows  the  turnover  of  the  night  force  to  be 
about  three  times  greater  than  that  of  the  day  force,  and  that  the  former 
is  responsible  for  a  turnover  entirely  out  of  proportion  to  its  strength 
in  the  organization.  Over  the  three-year  period,  the  night  force  consti- 
tuted about  20  per  cent  of  the  total  working  force,  but  is  chargeable  with 
nearly  45  per  cent  of  the  total  separations.  The  greater  shifting  among 
the  night  workers  causes  the  turnover  figures  for  the  establishments 
as  a  whole  to  appear  from  28  to  40  per  cent  higher  than  they  would  be 
if  the  changes  among  the  night  force  were  in  equal  proportion  with  those 
of  the  day  force.  General  dislike  for  night  work,  in  spite  of  the  fact 
that  wages  have  been  about  20  per  cent  higher,  and  the  exercise  of  a 
somewhat  less  strict  supervision,  are  stated  to  have  been  responsible  for 
the  greater  turnover  of  the  night  force." — Emil  Frankel,  Labor  Turn- 
over in  Cincinnati,  Monthly  Labor  Review,  Mar.  1919,  p.  40. 


226  PERSONNEL   RELATIONS   IN  INDUSTRY 

The  percentage  of  the  whole  body  of  workers  that  is 
responsible  for  the  largest  percentage  of  turnover  is  a  small 
one.  There  is  a  drifting  body  of  workers,  wandering  from 
job  to  job  and  swelling  the  turnover  tables  of  many  plants 
in  the  course  of  a  year,  that  deserves  special  study.  Some  of 
them  are  excellent  workmen.  Many  of  them  possess  ability 
in  the  field  of  originality  that  would  be  of  great  value  to  any 
industry.  This  body  of  workers  needs  closer  analysis  to 
determine  the  methods  by  which  each  section  of  it  can  best 
be  treated.  This  analysis  will  need  the  help  of  the  psychologist 
and  the  psychiatrist  in  some  fields.  Some  observations  made 
by  E.  E.  Southard,  at  the  psychopathic  hospital  in  Boston, 
indicate  that  there  are  certain  mental  classes  that  are  particu- 
larly contributory  to  large  turnover  and  that  should  be  studied 
in  order  to  ascertain  the  proper  treatment.12 

Maladjustment  of  Instincts  to  Environment 

It  must  be  remembered  that  change  was  the  rule  in  indus- 
try until  within  comparatively  recent  years.  Habits  and  in- 
stincts inbred  through  centuries  by  the  then  existing  industrial 
environment  are  not  easily  adjusted  to  the  wholly  different 
conditions  of  modern  industry.  G.  Stanley  Hall  summarizes 
some  of  these  most  contrasting  characteristics  as  follows: 1S 

For  unnumbered  generations  primitive  man  in  the  nomad 
age  wandered,  made  perhaps  annual  migrations,  and  bore 
heavy  burdens,  while  we  ride  relatively  unencumbered.  He 
tilled  the  reluctant  soil,  digging  with  rude  implements  where 
we  use  machines  of  many  man-power.  In  the  stone,  iron 
and  bronze  age,  he  shaped  stone  and  metals,  and  wrought 
with  infinite  pains  and  effort,  products  that  we  buy  without 
even  knowledge  of  the  processes  by  which  they  are  made. 


"  E.  E.  Southard,  The  Mental  Hygiene  of  Industry,  Industrial  Man- 
agement, Feb.  1920,  pp.  IOI,  102.     Has  short  bibliography. 
MG.  S.  Hall,  Adolescence,  1907,  Vol.  I,  p.  167. 


LABOR  TURNOVER  227 

As  hunter  he  followed  game,  and  when  found,  he  chased, 
fought,  and  overcame  it  in  a  struggle  perhaps  desperate, 
while  we  shoot  it  at  a  distance  with  little  risk  or  effort.  In 
warfare  he  fought  hand  to  hand  and  eye  to  eye,  while  we 
kill  "with  as  much  black  powder  as  can  be  put  in  a  woman's 
thimble."  He  caught  and  domesticated  scores  of  species  of 
wild  animals  and  taught  them  to  serve  him;  fished  with 
patience  and  skill  that  compensated  his  crude  tools,  weapons, 
implements,  and  tackle;  danced  to  exhaustion  in  the  service 
of  his  gods  or  in  memory  of  his  forebears,  imitating  every 
animal,  rehearsing  all  his  own  activities  in  mimic  form  to 
the  point  of  exhaustion,  while  we  move  through  a  few  figures 
in  closed  spaces.  He  dressed  hides,  wove  baskets  which  we 
cannot  reproduce,  and  fabrics  which  we  only  poorly  imitate 
by  machinery,  made  pottery  which  set  our  fashions,  played 
games  that  invigorated  body  and  soul.  His  courtship  was 
with  feats  of  prowess,  and  skill,  and  meant  physical  effort 
and  endurance. 

It  is  the  physical  and  mental  heir  to  all  this  manifold 
activity  that  we  are  trying  to  tie  down  to  monotonous  machine 
tending.  That  the  process  is  marked  with  some  friction  and 
resistance  on  the  part  of  the  deeply  implanted  tendencies  of 
human  nature  is  not  surprising.  Nor  is  it  certain  that  it 
would  be  well  if  industry  should  succeed  in  conquering  and 
bending  that  nature  to  its  will.  After  all,  industry  exists  for 
man  and  not  the  reverse.  Therefore  we  shall  find  that  those 
things  which  make  industry  attractive  and  reduce  turnover 
are  largely  those  which  will  gratify  the  instincts  and  impulses 
implanted  during  this  long  period  that  Hall  describes. 

Effect  of  Interest  in  Work  on  Turnover 

How  true  this  is  becomes  plain  from  an  examination  of  the 
"five  principal  characteristics,"  which  Slichter  found  of  most 
value  in  interesting  men  in  work  and  reducing  turnover.  They 
are: 14 

14  S.  H.  Slichter,  The  Turnover  of  Factory  Labor,  1919,  p.  188.     See 


228  PERSONNEL   RELATIONS   IN   INDUSTRY 

1.  More  or  less  variety.  .  .  . 

2.  An   element  of   the   unexpected,    the   unknown.     To 
know  with  absolute  certainty  what  is  coming  next  is  dull. 
The  love  for  the  new,  the  unknown,  is  universal;  it  is  part 
of  the  spirit  of  adventure  which  all  men  possess  in  large  or 
small  degree.  .  .  . 

3.  The  opportunity  to   exercise   initiative,   ingenuity,   to 
decide  for  oneself  how  to  do  things  rather  than  have  the 
decisions  made  for  one.    It  seems  an  inherent  trait  in  human 
nature  to  enjoy  having  one's  resourcefulness  appealed  to. 
Problems  in  themselves  exert  a  fascination.    The  process  of 
unraveling  them  and  the  sense  of  achievement  which  comes 
with  success  is  pleasurable. 

4.  The  ability  to   see  a  fairly  definite  prospect  of  ad- 
vancing by  merit  to  better  paying  or  more  attractive  work. 

5.  The  opportunity  to  feel  pride  in  one's  work  and  to  win 
the  respect  and  esteem  of  other  men. 

We  have  already  considered  the  methods  by  which  these 
characteristics  can  be  given  to  production.  They  are  basic 
at  every  point,  and  nowhere  more  than  in  controlling  turn- 
over. Indeed,  there  is  little  new  that  need  be  said  under 
the  special  subject  of  turnover  if  all  necessary  has  been  said 
upon  good  personnel  management.  Hiring,  promotion,  rating, 
training,  welfare,  arousing  interest — all  are  remedies  for  one 
or  more  phases  of  the  problem. 

This  is  especially  true  of  the  scientific  organization  of 
production.  Much  of  turnover  everywhere  is  due  to  poorly 
planned  shop  operation ;  piece-workers  must  wait  for  material, 
machines  are  uncared  for,  large  seasonal  fluctuations  are  per- 
mitted, and  workshops  are  badly  arranged.  It  is  the  universal 
testimony  that  proper  organization  of  production  greatly 
reduces  turnover. 


also  The  Turnover  of  Labor,  Federal  Board  of  Vocational  Education 
Bulletin  No.  46,  pp.  44-58,  on  methods  used  by  various  firms  in  reducing 
turnover. 


LABOR  TURNOVER  229 

Cost  of  Labor  Turnover 

Upon  one  thing  all  investigators  of  this  subject  are  agreed: 
no  expense  connected  with  any  proposed  method  of  obviating 
turnover  could  cost  any  important  fraction  of  the  sum  the 
present  unnecessary  changes  of  personnel  impose  upon  indus- 
try. Indeed,  nearly  all  the  suggestions  for  reduction  of  turn- 
over would,  in  themselves,  increase  production  and  make  for 
greater  economy  of  operation,  entirely  aside  from  their  effect 
upon  the  flow  of  labor  through  the  plant. 

In  the  now  famous  study  of  turnover  made  by  M.  W. 
Alexander,  and  which  was  largely  responsible  for  the  atten- 
tion since  focused  upon  the  subject,  he  estimates  the  cost  of 
each  change  of  an  employee  at  from  $8.50  for  the  least  skilled 
workers  to  $73.50  for  highly  skilled  mechanics.15  For  execu- 
tives, it  is  many  times  the  higher  sum.  Estimates  of  the 
total  direct  waste  due  to  excessive  turnover  in  the  United 
States  have  varied  from  $400,000,000  to  a  full  billion  dollars 
annually. 

Yet  none  of  these  calculations  include  an  accompanying 
waste  which  is  probably  far  greater  than  the  direct  cost  of 
hiring,  training,  breakage,  excessive  accidents,  and  other  items 
that  are  usually  included  in  such  computations.  This  is  the 
immeasurable  and  incalculable  waste  due  to  the  fact  that  no 
efficient  organization  of  industry  is  really  possible  with  a  con- 
stantly changing  personnel.  Any  adequate  system  of  organ- 
ization is  based  on  permanency. 

Turnover  expenses  appear  in  many  forms  and  from  some 
rather  unexpected  sources.  New  employees  swell  the  accident 
rates. 

In  all  industries  the  new  men — the   "green"  men — are 
most  frequently  injured.    In  a  large  steel  plant  the  accident 

"Annals  of  the  American  Academy,  May,  1916,  pp.  128-144;  The 
Turnover  of  Labor,  Federal  Board  for  Vocational  Education,  Bulletin 
No.  46,  pp.  12-15. 


230  PERSONNEL   RELATIONS   IN   INDUSTRY 

records  show  that  men  employed  less  than  thirty  days  were 
injured  six  times  as  frequently  as  those  employed  longer, 
and  that  those  employed  less  than  six  months  were  injured 
four  times  as  frequently  as  the  remainder.  These  accidents 
are  due  not  so  much  to  carelessness  or  foolhardiness  as  to 
ignorance  of  the  hazards  and  the  proper  way  to  do  the  work 
and  hesitancy  in  asking  for  instruction.16 

Wastes  of  Turnover 

High  turnover  leads  to  inefficiency  everywhere.  The  only 
reason  an  old  employee  is  not  always  recognized  as  more 
valuable  than  a  new  one  is  because  the  management  has  no 
adequate  cost  and  production  records.  Proper  management 
means  constant  growth  of  all  concerned  until  the  prime  of 
life  is  passed,  and  extends  that  prime  further  and  further. 

High  turnover  curses  employer  and  employee  alike.  The 
wandering  worker  not  only  loses  wages  during  the  period 
of  change.  He  can  build  no  home  during  his  wanderings. 
He  seldom  can  grow  in  skill  and  enjoy  his  work.  He  wastes 
his  earnings  in  transportation.  He  undergoes  greater  danger 
of  accident.  Through  all  these  influences  he  is  gradually 
dragged  to  a  lower  mental,  moral,  and  physical  level.17 

The  tramp  population  is  largely  recruited  from  the  exces- 
sive turnover  due  to  inefficient  management.  The  burden  cast 
upon  the  community  by  increased  pauperism,  insanity,  and 
criminality  due  to  the  endless  and  useless  shifting  of  labor 
forces  is  a  heavy  one. 

Industries  with  Low  Turnover 

Certain  industries  stand  out  as  constant  and  striking  proof 
that  a  high  turnover  is  unnecessary.  The  turnover  among 


"A.  H.  Young,  manager  industrial  relations  of  International  Harvester 
Company,  Address  to  School  of  Safety  Engineers  in  St.  Louis,  American 
Gas  Engineering  Journal,  Mar.  15,  1919,  p.  232. 

"S.  H.  Slichter,  The  Turnover  of  Factory  Labor,  1919,  p.  142.  This 
whole  chapter  treats  of  the  cost  of  labor  turnover  to  the  employee. 


LABOR  TURNOVER  231 

railroad  engineers  is  but  4.8  per  cent,  although  with  firemen 
and  brakemen  it  is  35.7  per  cent.18  In  the  civil  service  of 
the  United  States  the  turnover  is  but  8  per  cent.  Among 
teachers,  even  at  the  time  of  greatest  discontent  and  poorest 
wages,  it  did  not  exceed  20  per  cent.  Turnover  among  male 
office  help  seldom  reaches  20  per  cent. 

A  study  of  the  common  characteristics  of  these  very 
divergent  industries  shows  that  they  all  possess  certain  fea- 
tures that  forestall  turnover.  All  have  a  careful,  standardized 
system  of  selection,  generally  by  some  sort  of  impartial  ex- 
amination. The  employees  are  all  skilled  and  educated. 
Promotion  is  by  some  definite  and  well-understood  system  of 
seniority  or  merit.  All  other  conditions  differ.  Some  have 
high,  others  exceptionally  low  wages.  Some  require  hard 
physical,  others  wholly  mental  work.  In  none  is  there  any 
extensive  welfare  work  and  few  have  any  sort  of  bonus 
or  peculiar  wage  system. 

Means  of  Reducing  Turnover 

While  not  belittling  the  value  of  wages  and  welfare  to 
reduce  turnover,  the  lesson  of  these  illustrations  would  seem 
to  be  that  other  things  are  much  more  attractive.  The  one 
most  characteristic  feature  of  them  all  is  the  certain  oppor- 
tunity for  continuous  growth  with  the  industry.  This  accords 
with  the  conclusion  of  Sumner  H.  Slichter,  who  says:  19 

The  importance  of  the  lack  of  a  fairly  definite  prospect 
of  advancing  to  better  paying  or  more  attractive  work  has 
been  inadequately  appreciated.  Most  men  feel  the  need  of 
a  goal  to  put  the  zest  of  the  struggle  and  contest  into  their 
work,  the  hope  of  better  things  to-morrow  to  take  their 
minds  off  the  difficulties  of  to-day.  The  factory  workman  is 
the  same  as  other  men  in  these  respects.  Every  factor  which 


u  S.  H.  Slichter,  The  Turnover  of  Factory  Labor,  1919,  p.  23. 
11  Ibid.,  pp.  189,  190. 


232  PERSONNEL   RELATIONS    IN   INDUSTRY 

lessens  the  hope  of  better  things  to-morrow  renders  the 
hardships  of  to-day  doubly  onerous.  This  is  precisely  the 
effect  of  the  failure  of  employers  to  follow  a  definite  policy 
of  promoting  by  merit,  which  is  typical  of  modern  industry. 

Good,  thorough,  general  employment  practice,  such  as  is 
attainable  only  through  careful,  continuous  work,  is  the  most 
effective  way  of  reducing  excessive  turnover.  As  the 
standards  of  personnel  management  rise,  the  turnover  falls. 

It  should  not  be  hard  to  reduce  turnover.  The  one  thing 
workmen  everywhere  desire,  in  spite  of  all  appearances  and 
occasional  actions  to  the  contrary,  is  a  "good,  steady  job." 
All  the  instincts  of  change  that  have  been  noted  will  give 
way,  under  proper  management,  to  the  powerful  home-making 
instinct. 

There  is  a  possibility  of  reducing  turnover  to  a  point  where 
routine  and  stagnation  to  industry  and  individual  might  be  a 
result.  There  is  value  in  new  blood  for  the  organization  and 
change  for  the  personnel.  Save  for  a  few  departments,  how- 
ever, and  an  occasional  most  exceptional  industry,  these 
dangers  are  far  from  threatening.  A  mere  mention  of  their 
existence  is  almost  sufficient  warning.  The  remedy  is  at  hand. 
Change  within  the  industry,  education,  occasional  "promotions 
up  and  out"  of  those  who  manifestly  can  find  greater  oppor- 
tunities elsewhere,  and  above  all  else,  plenty  of  opportunity 
for  the  introduction  of  new  ideas  to  refresh  the  entire  organ- 
ization, will  avoid  the  evils.20 


"  Some  of  these  objections  to  excessive  leflgth  of  service,  and  espe- 
cially to  methods  of  restraining  employees  which  smack  of  compulsion — 
such  as  withholding  of  special  payments  for  a  long  period  of  continuous 
service — are  discussed  by  Ralph  E.  Heilman,  Do  You  Keep  Your  Men 
too  Long,  System,  April,  1919. 


CHAPTER  XIV 
WIDER    SOCIAL   CONTROL 

Effect  of  Outside  Forces  on  Industry 

There  are  forces  far  beyond  the  boundaries  of  the  in- 
dividual shop  or  business  house  that  affect  personnel  rela- 
tions. Every  industry  operates  within  a  framework  of  laws, 
court  decisions,  and  customs.  Its  foundation  rests  upon  prop- 
erty relations,  contracts,  wage  systems,  and  legal  institutions. 
These  laws  and  customs  spread  in  ever-widening  influence. 

The  forces  that  make  such  laws  and  customs,  while  beyond 
the  power  of  the  individual  shop  manager,  are,  in  a  democracy 
especially,  created  by  a  public  will  of  which  the  entire  human 
personnel  of  industry  is  the  determining  factor.  Ignorance 
of  this  embracing  network  blinds  the  personnel  director  to 
some  of  the  most  important  elements  in  his  problem. 

Such  a  director  may  think  himself  little  touched  by  inter- 
national movements,  yet  at  times  these  come  very  close  home. 
Markets  are  worldwide.  Prices  are  fixed  by  movements  on 
the  other  side  of  the  globe.  Great  international  population 
movements  are  largely  responsible  for  the  present  interest  in 
personnel  problems.  American  industry  taps  every  section  of 
the  earth  in  its  search  for  a  labor  supply,  and  immigration 
touches  every  employment  problem.  When  the  war  and  the 
social  upheavals  that  accompanied  it  threw  the  currents  of 
migration  out  of  their  accustomed  channels,  almost  every  in- 
dustry in  America  felt  the  effects  of  a  restricted  labor  supply. 

Effect  of  Environment  on  Human  Nature 

Personnel  managers  must  know  not  only  human  nature, 
but  human  nature  as  affected  by  environment.  We  have 

233 


234  PERSONNEL   RELATIONS   IN  INDUSTRY 

learned  that  knowledge  of  human  nature  is  not  to  be  gained 
by  any  esoteric  insight,  any  hocus-pocus  character  analysis, 
or  glib  knowledge  and  pretended  application  of  pseudo- 
sciences.  We  know  that  the  foundation  of  human  nature  is 
composed  of  those  instincts  which  the  cultured  citizen  shares 
with  the  primitive  savage.  To  these,  however,  are  added  the 
habits,  impulses,  customs,  and  prejudices  which  environment 
implants,  and  which  together  make  up  those  race  character- 
istics that  differentiate  peoples  and  bind  together  national 
groups. 

The  personnel  manager  who  wishes  to  "know  human 
nature"  must  be  familiar  with  these  race  characteristics.  He 
learns  them  from  a  study  of  the  social  environment  that 
produced  them — an  environment  that  is  always  changing,  and 
changing  today  faster  than  ever  before.  A  knowledge  of  the 
aspirations,  conflicts,  and  shifting  conditions  in  national  and 
international  relations  is  essential. 

International  Relations 

Certain  effects  of  international  relations  are  becoming 
more  specific.  Even  before  the  war,  industrial  legislation 
was  partially  determined  by  international  agreement.  Sixteen 
nations  sent  official  representatives  to  the  International  Asso- 
ciation for  Labor  Legislation  that  met  at  Lucerne  in  1908. 
The  threat  of  war  somewhat  reduced  the  number  of  nations 
represented  at  the  conference  held  in  Berne  in  September, 
1913.  These  meetings  of  the  association  shaped  the  conven- 
tions that  ended  the  use  of  white  phosphorous  in  the  manu- 
facture of  matches,  that  drew  up  the  drafts  for  international 
agreements  to  prohibit  night  work  for  children  under  sixteen, 
and  that  established  a  maximum  working  day  of  ten  hours 
for  women  and  young  persons.1 

1  League  of  Nations,  Vol.  II,  Oct.  1919,  pp.  271-279. 


WIDER  SOCIAL  CONTROL  235 

The  League  of  Nations  provides  for  an  International 
Labor  Office.  Although  the  United  States  has  not  entered 
the  League,  the  first  International  Labor  Conference  was  held 
at  Washington  in  November,  1919.  That  conference,  with 
almost  complete  unanimity,  adopted  a  series  of  conventions 
concerning  labor  legislation.  Whether  the  United  States  con- 
tinues its  policy  of  isolation  or  not,  it  will  feel  the  influence 
of  these  conventions.  We  cannot  escape  the  pressure  of 
organized  worldwide  opinion. 

Certain  tendencies  in  this  international  movement  are 
clear.  They  were  plainly  evident  at  the  Washington  confer- 
ence and  had  made  themselves  manifest  several  years  before. 
They  grow  stronger  and  clearer  each  year,  so  that  no  one 
interested  in  personnel  relations  can  plan  intelligently  without 
taking  these  tendencies  into  consideration. 

For  one  thing,  the  various  nations  are  more  closely 
restricting  the  labor  of  women  and  children.  In  all  prob- 
ability every  industrial  nation  will  soon  insist  upon  eigh- 
teen as  the  minimum  age  at  which  regular,  compulsory,  state 
education  shall  cease.  Education  is  constantly  broadening  its 
scope  to  include  more  vocational  and  industrial  training. 
Women  in  industry  are  everywhere  being  given  more  protec- 
tive care.  The  conditions  under  which  they  work,  their  hours 
of  labor,  their  periods  of  leisure,  restrooms,  care  during  ill- 
ness and  especially  during  motherhood,  are  all  matters  receiv- 
ing attention.  Every  nation  is  insisting  that  the  mothers 
of  the  race  must  not  be  sacrificed  to  industry.  On  all  these 
points  international  action  is  clear.  It  is  moving  toward  an 
ever  higher  standard  as  nation  after  nation  comes  into  line 
with  this  tendency. 

Universal  Eight-Hour  Day 

Delegate  after  delegate  at  the  Washington  conference  pre- 
sented reports  of  recent  eight-hour  legislation.  There  is 


236  PERSONNEL   RELATIONS    IN   INDUSTRY 

scarcely  a  nation  in  the  world  that  has  not  passed  laws  restrict- 
ing the  hours  of  labor.  Nearly  all  of  these  laws  have  been 
passed  since  the  beginning  of  the  war,  and  most  of  them 
since  its  close.  The  scope  of  such  legislation  is  embracing 
more  and  more  industries  and  converging  upon  the  eight- 
hour  day.  Such  a  universal  tendency  is  a  safe  foundation 
for  the  prediction  that  all  industry  must  prepare  to  operate 
upon  an  eight-hour  basis.  The  momentary  pressure  for 
production  following  the  war,  intense  as  it  was,  could  not 
restrain  this  movement.  When  that  pressure  shall  pass,  the 
demand  for  shorter  hours  will  be  irresistible. 

The  Unemployment  Problem 

The  nations  of  the  world  are  agreeing  that  the  burden 
of  unemployment  must  not  forever  rest  its  full  weight  upon 
the  employee  class.  A  form  of  industry  that  requires  a  reserve 
army  of  deteriorating  idlers  as  a  condition  of  its  existence, 
must  at  least  pay  for  maintaining  that  army  and  for  pre- 
venting its  deterioration  to  a  greater  degree  than  is  inevitable. 
There  are  many  plans  looking  in  this  direction.  Many  nations 
give  unemployed  relief  either  in  the  form  of  insurance,  sub- 
ventions to  union  funds,  or  by  state  work.  Still  more  nations 
have  organized  systems  of  national  employment  offices  to 
adjust  the  labor  supply.  Nearly  all  have  undertaken  extensive 
studies  of  the  causes  of  the  industrial  cycles  that  aggravate 
unemployment,  with  a  view  to  alleviating  or  removing  their 
effects.  In  view  of  the  strong  and  almost  universal  pressure 
for  some  sort  of  protection  against  the  evils  of  unemploy- 
ment, the  personnel  director  may  take  it  for  granted  that 
the  time  is  near  when  society  will  intervene  in  every  nation 
to  meet  this  problem.2 


'International   Labor   Conference,   Washington,    1919,   Draft   Conven- 
tion on  Unemployment,  Monthly  Labor  Re-view,  Feb.  1920,  pp.  324,  325. 


WIDER   SOCIAL   CONTROL  237 

Immigration  Problem 

Immigration  and  emigration  are  essentially  international 
questions.  There  are  few  industries  in  America  that  they 
do  not  directly  affect.  European  members  of  the  Interna- 
tional Labor  Office  are  interested  in  emigration,  while  America 
thinks  only  in  terms  of  immigration.  The  information  that 
will  be  circulated  by  the  Labor  Office  will  henceforth  have 
much  to  do  with  determining  the  movements  of  population. 

The  greatest  single  source  of  information  concerning  the 
manifold  facts  affecting  personnel  in  industry  will  probably 
be  this  International  Labor  Office.  Only  a  statistical  collect- 
ing agency  that  embraces  the  world  and  has  the  resources 
of  many  governments,  can  gather  and  arrange  the  facts  that 
will  make  possible  the  charting  of  those  great  industrial  cycles 
of  prosperity  and  panic.  These  wide  swings  and  mysterious 
movements  of  prices,  wages,  markets,  money,  and  men  make 
modern  business  a  gamble  instead  of  a  science. 

National  Legislation  and  Administration 

National  legislation  and  administration  impinge  upon  in- 
dustrial relations  at  many  points.  Such  topics  as  control  of 
monopoly,  levying  of  taxes,  regulation  of  interstate  commerce, 
national  supervision  of  banking,  and  federal  injunctions  sug- 
gest a  few  of  the  many  ways  in  which  labor  relations  are 
closely  affected  by  government  action.  Direct  handling  of 
many  wage  relations  appears  imminent.  It  is  already  here 
in  transportation  and  mining.  Congress  has  fixed  the  condi- 
tions of  employment  on  the  sea;  it  has  regulated  child  labor; 
and  Supreme  Court  decisions  plainly  tend  toward  extending 
the  field  of  congressional  power  in  this  direction. 

Education  was  long  the  exclusive  function  of  state  and 
local  governments.  Now  the  nation  is  entering  it  in  the  field 
closest  to  industry.  The  Federal  Board  for  Vocational  Educa- 
tion, composed  of  the  Secretaries  of  Labor,  Agriculture,  and 


238  PERSONNEL   RELATIONS   IN   INDUSTRY 

Commerce,  the  Commissioner  of  Education,  and  three  civilian 
members  representing  manufacture,  agriculture,  and  com- 
merce, administers  the  subsidy  granted  by  the  national  govern- 
ment to  vocational  schools.  As  this  subsidy  is  given  only  on 
approval  of  the  course  of  study,  the  character  of  the  indus- 
trial education  of  the  country  is  determined  by  this  board. 

The  board  co-operates  with  training  departments  of  great 
industries,  with  the  public  school  system  everywhere,  and  with 
all  persons  interested  in  vocational  training  and  employment 
management.  In  so  doing  it  is  creating  national  standards 
in  all  these  lines  of  work.  It  is  publishing  and  distributing, 
without  charge,  a  large  amount  of  the  most  valuable  educa- 
tional material  in  all  these  fields.3 

Industrial  Research 

Industrial  research  is  a  growing  field  of  scientific  investiga- 
tion and  information.  Hitherto,  however,  it  has  been  largely 
a  thing  of  patchwork  and  shreds.  A  few  large  banks,  the 
most  progressive  advertising  agencies,  some  professional 
"prognosticates"  for  investors,  here  and  there  an  enterprising 
corporation,  the  most  efficient  trade  associations,  and  many 
other  overlapping  and  competing  bodies  have  been  working 
in  this  field.  Nearly  all  of  their  work  has  been  statistical, 
and  will  be  referred  to  later.  Original  investigation  of  prob- 
lems of  production  and  of  organization  of  industry,  and  scien- 
tific investigation  of  machines,  materials,  and  methods  have 
been  even  more  fragmentary  and  disconnected.  Such  work 
has  been  scattered  through  the  departments  dealing  with 


"See  especially,  Bulletin  No.  43,  The  Labor  Audit;  Bulletin  No.  44, 
The  Wage  Setting  Process ;  Bulletin  No.  45,  Job  Specifications ;  Bulletin 
No.  46,  The  Turnover  of  Labor;  Bulletin  No.  47,  Industrial  Accidents 
and  Their  Prevention;  Bulletin  No.  48,  Employment  Management  and 
Industrial  Training;  Bulletin  No.  49,  The  Selection  and  Placement  of 
Employees;  Bulletin  No.  50,  Employment  Management — Its  Rise  and 
Scope. 


WIDER  SOCIAL  CONTROL  239 

geology,  agriculture,  forestry,  and  a  score  of  other  widely 
separated  and  loosely  connected  bodies.  The  creation  of  the 
National  Research  Council  during  the  war  indicates  a  move 
to  centralize  and  systematize  such  research.  It  also  brings 
the  government  into  close  touch  with  industry  at  many  new 
points.  The  Committee  for  Psychology  of  this  council 
developed  the  psychological  tests  used  in  the  army.  It  has 
since  been  adapting  these  tests  to  industrial  employment.* 

The  Department  of  Labor 

Every  phase  of  personnel  work  in  industry  is  affected 
by  the  work  of  the  Department  of  Labor.  The  Secretary 
of  Labor  is  authorized  by  the  law  creating  the  position  to 
"act  as  mediator  and  to  appoint  commissioners  of  conciliation 
in  labor  disputes  whenever  in  his  judgment  the  interests  of 
industrial  peace  may  require  it  to  be  done."  This  form  of 
work  grows  in  importance  steadily.  "During  the  year  from 
July  I,  1918,  to  June  30,  1919,  the  Department  assigned 
conciliators  to  1,780  cases,  made  up  of  587  strikes,  1,113 
disputes  and  threatened  strikes,  63  lockouts  and  17  walkouts; 
of  these  it  succeeded  in  adjusting  1,223  or  68  per  cent."  5 

The  Department  of  Labor  administers  the  immigration 
laws ;  it  passes  upon  deportations ;  it  decides  upon  some  phases 
of  the  contract  labor  law.  Its  actions  greatly  influence  the 
flow  of  foreign-born  labor.  The  Bureau  of  Statistics  main- 
tained by  the  Department  is  the  most  important  source  of 
information  on  labor.  Its  multitudinous  publications  con- 
stitute a  continuous  and  authoritative  information  service  for 
the  personnel  worker.  The  Monthly  Labor  Review  is  the 
most  valuable  periodical  in  this  field.  It  contains  valuable 
special  studies  by  experts ;  summaries  of  all  important  events ; 


4  C.  S.  Yoakum  and  R.  M.  Yerkes,  Mental  Tests,  1920,  Introduction. 
§  M.  H.  Wiseman,  Keeping  the  Peace  with  Labor,  Industrial  Manage- 
ment, Mar.   1920. 


240  PERSONNEL   RELATIONS   IN   INDUSTRY 

the  most  complete  and  authoritative  tables  of  wages;  prices 
and  index  numbers ;  sample  current  collective  bargains ;  trans- 
lations of  the  most  important  foreign  publications;  a  critical 
bibliography  of  all  books  and  important  periodical  literature; 
and  a  mass  of  similar  information  needed  for  intelligent  em- 
ployment management. 

During  the  war,  the  Department  of  Labor  was  the  agency 
through  which  the  national  labor  supply  was  mobilized.  This 
was  done  by  the  United  States  Employment  Service.  What- 
ever its  defects,  this  was  the  first  long  step  toward  bringing 
order  out  of  the  chaos  of  the  labor  market.8 

Children's  Bureau  and  Public  Health  Service 

The  Children's  Bureau  is  under  the  Department  of  Labor. 
It  deals  primarily  with  children  below  the  employment  age. 
Its  studies  of  family  life  and  infant  mortality  contain  the 
most  complete  and  authoritative  information  concerning  the 
effect  of  wages  upon  living  conditions.  Its  publications  are 
essential  to  an  understanding  of  the  subject  of  budgets  for 
working-class  families,  upon  which  wages  are  coming  more 
and  more  to  depend  for  their  determination.7 

One  of  the  most  remarkable  developments  of  any  govern- 
ment bureau  during  the  war  was  that  of  the  United  States 
Public  Health  Service.  This  operates  under  the  Treasury 
Department.  It  has  entered  upon  a  campaign  for  public  health 
and  sanitation,  and  has  established  a  department  of  industrial 
hygiene.  Already  its  publications  are  indispensable  to  any 
worker  concerned  with  factory  sanitation.8 


"  D.  D.  Lescohier,  The  Labor  Market,  Chaps.  IX-XI,  with  references,  a 
treatise  of  the  scope  and  need  of  a  federal  employment  service. 

TSee  especially,  Standards  of  Child  Welfare,  Bureau  Publication, 
No.  60. 

'See  C.  D.  Selby,  Studies  of  Medical  and  Surgical  Care  of  Industrial 
Workers,  Public  Health  Bulletin  No.  99. 


WIDER  SOCIAL  CONTROL  24! 

Government  Interest  in  Labor  Problems 

Government  is  becoming  daily  more  closely  allied  to  indus- 
try. The  efficient  employment  manager,  welfare  worker,  or 
personnel  director  must  keep  in  close  touch  with  government 
publications  and  work.  Otherwise  he  will  be  ignorant  of  some 
of  the  most  important  developments  in  his  profession. 

As  the  national  government  is  the  largest  employer  in 
the  country,  the  standards  governing  hiring,  promotion, 
wages,  hours,  organization,  pensions,  and  general  regulation 
of  personnel  in  the  national  civil  service  influence  all  private 
employment.  They  present  some  helpful  suggestions  as  well 
as  some  sharp  warnings. 

Congress  has  enacted  a  Minimum  Wage  Law  and  estab- 
lished a  Minimum  Wage  Board  for  women  in  the  District 
of  Columbia.  In  October,  1919,  this  board,  after  a  very 
elaborate  budget  study  into  the  cost  of  living,  fixed  a  wage 
of  $16.50  per  week  for  "experienced  workers"  in  mercantile 
establishments. 

The  government  enters  more  and  more  directly  into  the 
settlement  of  industrial  disputes.  It  does  this  not  only  through 
the  conciliatory  work  of  the  Department  of  Labor,  previously 
mentioned,  but  also  by  means  of  federal  injunctions,  and  by 
direct  legislation  in  the  case  of  the  railroads,  the  telegraph, 
and  other  interstate  public  utilities.  The  second  Industrial 
Conference,  called  by  the  President,  proposed  in  its  report 
of  March  6,  1920,  the  establishment  of  elaborate  machinery 
for  conciliation  and  arbitration.  The  enactment  of  legislation 
which  may  probably  be  expected  to  follow  would  funda- 
mentally change  industrial  relations. 

State  Industrial  Machinery 

In  entering  this  field  of  industrial  adjustment,  the  national 
government  is  but  following  the  path  of  the  states.  Thirty- 
six  states  have  already  established  machinery  for  action  in 


242  PERSONNEL   RELATIONS   IN   INDUSTRY 

industrial  disputes.  Such  machinery  has  generally  been  im- 
practical and  remained  inactive.  A  few  such  boards  of  arbi- 
tration, however,  have  frequently  intervened  to  the  satisfac- 
tion of  all  concerned.9 

The  scarcity  of  labor  that  followed  the  war  created  a 
demand  for  some  sort  of  compulsion  to  maintain  the  labor 
contracts,  as  such  scarcity  has  always  done  since  the  Black 
Death  lead  to  the  Statute  of  Laborers  in  the  fourteenth  cen- 
tury. The  coal  strike  led  Kansas  to  create  a  special  "Court 
of  Industrial  Relations"  to  settle  strikes.  The  experience  of 
more  than  four  centuries  and  a  score  of  nations  indicates 
that  such  attempts  only  accentuate  and  embitter  labor  con- 
troversies.10 Any  legal  enforcement  of  such  decisions  implies 
confiscation  of  capital  and  enslavement  of  labor.  Industry 
must  continue  to  rest  not  upon  compulsion  but  upon  mutual 
good-will. 

Tendencies  of  State  Legislation 

Workmen's  compensation  laws  are  everywhere  supplant- 
ing the  old  common  law  procedure  in  accidents.  This  is  in- 
troducing safety  campaigns,  group  insurance,  and  closer  in- 
spection of  factory  work.  Factory  legislation  constantly 
raises  the  standards  of  safety,  sanitation,  and  health  in  indus- 
try. Child  labor  legislation  grows  stricter.  The  age  at  which 
children  without  education  are  barred  from  labor  continually 
rises.  The  educational  minimum  likewise  rises  and  demands 
new  training  organizations. 

The  states  also  are  throwing  greater  protection  about  the 
work  of  women  as  well  as  children.  Provision  for  rest 
periods,  restriction  of  hours,  compulsory  seats,  and  a  mini- 
mum wage  indicate  a  trend.  The  firm  that  anticipates  such 


"Industrial  Information  Service,  Apr.  22,  1920,  pp.  2,  n,  12. 
10  See  p.  321. 


WIDER   SOCIAL   CONTROL  243 

social  action  obtains  an  important  advantage  over  its  more 
grasping  and  less  far-sighted  competitors. 

Basis  of  Community  Control 

Community  control  is  steadily  increasing.  More  and  more 
those  interests  commonly  grouped  under  the  name  of  "public," 
because  they  interweave  and  overlap  in  each  individual  and 
class,  are  rinding  legislative  expression.  There  are  points 
where  this  control  touches  directly  upon  the  technique  of  per- 
sonnel work.  The  testing  of  trade  skill,  training,  public  em- 
ployment offices,  and  vocational  guidance  are  all  coming  more 
and  more  to  be  considered  as  general  public  functions. 

Labor  turnover  is  not  a  thing  of  an  individual  establish- 
ment alone.  The  greatest  fluctuations  are  due  to  deeper  social 
causes  than  are  touched  by  a  personnel  department.  Since 
1902  "the  number  of  unemployed  in  cities  in  the  United  States 
(entirely  omitting  agricultural  labor,  for  which  no  reliable 
data  are  now  available)  has  fluctuated  between  1,000,000  and 
6,000,000.  The  least  unemployment  occurred  in  1906-1907, 
and  in  1916-1917,  while  the  most  occurred  in  1914-1915. 
The  average  number  unemployed  has  been  two  and  a  half  mil- 
lion workers,  or  nearly  ten  per  cent  of  the  active  supply."  u 

Only  by  close  co-operation  of  large  classes  of  industry, 
including  governmental  undertakings,  is  it  possible  to  meet 
this  wider  problem  of  labor  fluctuations.  The  first  step  to  this 
co-operation,  from  the  side  of  private  industry,  must  come 
through  the  field  of  statistics.  In  the  comparatively  recent 
expansion  of  the  use  of  graphs  and  other  symbolic  forms  of 
expression,  statistics  have  gained  a  power  of  expansion  com- 
parable to  that  which  algebra  brought  to  mathematics.  These 
graphic  presentations  aid  and  add  to  the  power  of  imagination. 


"Hornell  Hart,  Fluctuations  in  Unemployment  in  Cities  of  the  United 
States,  1902-1907,  1908,  pp.  51,  52. 


244  PERSONNEL  RELATIONS   IN   INDUSTRY 

They  make  possible  quick  and  accurate  comparisons,  and  the 
projection  of  lines  of  complex  tendencies  into  the  future. 

These  methods,  so  essential  to  extensive  action,  call  for 
adequate  statistical  departments  in  the  individual  firms,  cor- 
related with  appropriate  governmental  agencies  for  their 
general  compilation  and  a  "pitiless  publicity"  that  shall  make 
the  facts  available. 

Personnel  and  Statistical  Departments 

Personnel  and  statistical  departments  must  be  closely  con- 
nected through  the  new  methods  of  accounting.  These 
methods  are  being  adapted  to  the  demands  for  the  power 
of  prediction,  social  correlation,  and  increased  efficiency.  The 
old  system  of  accounting,  sometimes  called  the  "post-mortem" 
system,  and  its  inability  to  meet  the  complex  demands  of  today 
are  thus  described  by  G.  Charter  Harrison: ia 

The  whole  conception  of  a  cost  system  which  concen- 
trates solely  on  the  obtaining  of  data  relative  to  past  results 
is  unsound,  belonging  to  the  days  when  the  manufacturer 
was  satisfied  if  at  some  time  after  the  end  of  the  year  his 
accountant  presented  him  with  a  statement  showing  the 
annual  net  profits  realized.  To  be  able  to  operate  a  business 
with  the  maximum  degree  of  safety  and  profit,  before  any 
work  is  undertaken  there  should  be  an  intelligent  estimate 
of  what  its  cost  will  be,  this  estimate  providing  a  standard 
of  attainment  and  a  definite  incentive  to  economical  manu- 
facture. 

An  adequate  system  of  accounting  must  take  in  these  wider 
fields  also.  Otherwise  its  prediction  will  be  unreliable.  It 
must  be  related  through  the  statistical  department  to  the  whole 
field  of  statistical  knowledge.  It  then  becomes  part  of  the 
machinery  by  which  the  personnel  department  can  recommend 

M  G.  C.  Harrison,  Cost  Accounting  to  Aid  Production,  Industrial  Man- 
agement, Oct.  1918. 


WIDER   SOCIAL   CONTROL  245 

to  the  management  the  action  required  to  meet  the  wider 
problems  of  social  and  governmental  action  as  related  to  the 
individual  questions  of  the  firm. 

This  is  but  one  example  of  the  way  in  which  each  institu- 
tion within  the  industry  must,  if  it  is  to  fulfil  its  purpose, 
present  two  aspects.  One  of  these  is  related  to  the  specific 
firm  problems;  the  other  reaches  out  to  the  entire  world  of 
industrial  and  social  life.  More  than  any  other  single  indus- 
trial department,  that  of  personnel  is  the  connecting  link  be- 
tween these  two  aspects. 


CHAPTER  XV 

ORGANIZATION    OF   THE    PERSONNEL 
DEPARTMENT 

Rank  of  Employment  Executive 

The  foundation  of  successful  personnel  organization  is 
the  recognition  of  the  fact  that  men  are  dS  important  as 
machines,  money,  and  markets.  The  personnel  director  must 
be  placed  on  an  equality  with  the  heads  of  the  departments 
of  finance,  production,  and  sales.  The  leader  and  organizer 
of  the  human  forces  needs  all  the  skill  and  authority  that 
are  required  for  procuring  capital  and  controlling  credit,  for 
choosing  and  placing  machines  and  directing  currents  of  pro- 
duction, or  for  hunting  out  and  holding  the  favor  of  a  pur- 
chasing public.  His  acts  can  build  or  break  a  firm  even  more 
surely  and  quickly  than  those  of  the  heads  of  these  other 
fields  of  work. 

Harlow  S.  Person,  of  the  Tuck  School  at  Dartmouth  says 
of  the  position  of  such  a  director:  1 

The  best  type  of  employment  executive  is  of  as  high 
rank  as  the  works,  sales,  and  financial  executives,  has  as 
complete  and  independent  access  to  the  office  of  the  presi- 
dent, and  has  as  fully  his  confidence  with  regard  to  the 
problems  of  the  relation  between  the  management  and  the 
personnel  as  they  have  with  regard  to  the  problems  per- 


1 H.  S.  Person,  Training  of  the  Employment  Executive,  Annals  of 
the  American  Academy,  May  1916,  pp.  119,  120.  See  especially  N.  W. 
Shefferman,  Employment  Methods,  1920,  Chap.  II,  with  accompanying 
diagrams  on  positions  and  functions  of  an  employment  department; 
Daniel  Bloomfield,  Labor  Maintenance,  1920,  pp.  20-39,  where  many  such 
diagrams  are  also  given. 

246 


PERSONNEL   DEPARTMENT   ORGANIZATION  247 

tinent  to  their  respective  functions.  If  there  is  an  executive 
board  made  up  of  the  various  functional  managers,  he  is 
the  peer  of  any  man  on  that  board.  On  that  board  he  sits 
in  a  dual  capacity :  he  represents,  on  the  one  hand,  the 
desires  and  rights  of  the  working  force,  and  on  the  other 
hand,  the  desires  and  rights  of  the  management.  He  is  har- 
monizer  and  adjuster.  He  is  the  specialist  who  studies  the 
problems  of  industrial  democracy,  organized  labor,  collective 
bargaining,  employees'  consent,  and  so  on,  and  reports  his 
investigations  and  conclusions,  with  recommendations,  to 
that  board.  The  performance  of  these  functions  brings  him 
into  contact  with  leaders  of  the  working  people,  with 
students  of  social  affairs,  and  with  the  highest  executives  in 
the  management. 

Importance  of  Labor  Policy 

The  employment  executive  largely  determines  labor  poli- 
cies. Many  firms  have  hitherto  had  no  policy  save  the  worst 
of  all  policies — that  of  drift.  Nowhere  is  there  need  of  more 
study,  foresight  and  skill  than  in  planning  a  labor  policy. 
Long  before  such  questions  as  the  attitude  toward  unions, 
collective  bargaining,  joint  management,  the  eight-hour  day, 
welfare  work,  and  all  similar  problems  become  acute  a  decision 
for  them  should  be  prepared.  The  decision  should  not  be 
based  upon  prejudice,  impulse,  or  imagination,  but  upon 
tested,  standardized,  and  classified  facts,  impartially  pre- 
sented. 

William  Leiserson  indorses  the  position  that : z 

Labor  policy  is  a  matter  for  chief  executives.  It  is  the 
chief  executives  of  the  company  who  must  determine  the 
labor  policy  of  a  plant.  In  the  past  it  has  been  customary 
for  the  chief  executives  to  deal  only  with  the  production, 
finance  and  sales  problems.  Labor  was  left  as  an  incidental 
matter  for  production  superintendents  and  foremen  to 

3  Monthly  Labor  Review,  Oct.  1919. 


248  PERSONNEL   RELATIONS   IN   INDUSTRY 

handle.  Only  when  labor  difficulties  arose  was  labor  con- 
sidered important  enough  for  the  directors  to  handle  and  at 
such  time  subordinate  officers  had  already  committed  the 
company  to  a  policy  that  the  directors  were  oound  to  uphold. 
Only  by  determining  the  labor  policies  in  the  board  ot 
directors'  meetings,  where  they  can  be  considered  in  conjunc- 
tion with  production,  finance  and  sales  policies,  can  a  proper 
system  of  labor  relations  be  devised  and  kept  in  constant 
operation. 

Correlation  of  Labor  and  Sales  Policies 

The  necessity  of  correlating  employment  policy  with  all 
other  departments  of  management  must  constantly  be  kept 
in  mind.3  A  permanent  labor  policy,  involving  a  low  turn- 
over, a  regular  staff,  and  systematized  promotion  is  impossible 
without  the  co-operation  of  the  sales  and  production  depart- 
ments. Reduction  of  seasonal  employment  is  largely  up  to 
the  sales  manager.  Realization  of  the  losses  due  to  fluctua- 
tions in  employment  personnel  has  raised  the  question  of 
whether  the  "customer  is  always  right."  Extreme  adjustment 
to  the  market  to  secure  large  sales  may  be  less  profitable  in 
the  end  than  sticking  to  more  staple  production  and  waiting 
for  the  market  to  adjust  itself.  In  many  other  ways  a  sales 
department  can  cut  down  the  peaks  and  raise  the  valleys  of 
employment  fluctuations.  It  is  not  apt  to  do  this,  however, 
unless  the  employment  and  sales  managers  meet  on  equal 
terms  to  determine  firm  policy. 

Relation  to  Production  Department 

The  work  of  the  production  and  employment  departments 
is  closely  knit.  Planned  and  routed  work  is  basic  to  good 
employment  practice.  If  plant  processes  are  broken  and 

*  Handbook  on  Employment  Management,  United  States  Shipping 
Board,  Bulletin  No.  I,  pp.  7,  8;  Employment  Management,  Its  Rise  and 
Scope,  Federal  Board  for  Vocational  Education,  Bulletin  No.  50,  pp. 

21,  22. 


PERSONNEL   DEPARTMENT  ORGANIZATION          249 

irregular,  labor  will  be  uncertain  and  discontented.  Piece- 
workers, especially,  will  not  stay  where  they  must  wait  for 
material.  Day-workers  may  stay,  but  that  is  all  they  will 
do.  A  poorly  planned  production  department  is  first  aid  to 
indifferent  workmanship  and  high  turnover.  Wage  systems 
are  a  matter  for  joint  consideration  by  personnel  and  produc- 
tion heads.  This  must  be  true  at  every  point.  The  amount, 
form  of  payment,  method  of  fixing  and  every  other  detail 
of  wage-setting  affect  the  two  departments  vitally.  Time, 
motion,  and  fatigue  studies  depend  for  their  accuracy  and 
their  effect  upon  close  co-operation  between  the  two  depart- 
ments. Job  analysis,  training,  and  the  hiring,  promotion, 
discipline,  and  discharge  of  employees  demand  common  action 
and  a  joint  policy. 

Finance  and  the  Personnel  Department 

Because  many  of  the  duties  now  assumed  by  the  employ- 
ment department  have  hitherto  been  at  least  partially  per- 
formed by  persons  connected  with  production,  the  connection 
between  these  two  departments  is  more  easily  seen  than  be- 
tween the  finance  and  employment  departments.  But  we  have 
seen  that  systems  of  accounting  closely  affect  personnel.  We 
know  that  the  work  of  the  employment  manager  may  build 
up  or  destroy  credit,  and  that  the  tendency  to  base  credit  upon 
employment  relations  is  growing.  Financiers  are  coming  to 
see  that  plant  good-will,  as  well  as  market  good-will,  must 
be  counted  among  bankable  assets.4  The  accounting  and  sta- 
tistical department  is  a  tie  that  must  bind  production,  finance, 
sales,  and  personnel  management.  All  must  have  a  voice  in 
deciding  what  facts  shall  be  gathered  and  equal  access  to  all 
information  obtained. 

Finance  and  personnel  managers  must  meet  to  determine 

4  See  pp.  115,  124. 


250  PERSONNEL   RELATIONS    IN   INDUSTRY 

another  point  of  policy.  The  successful  entrepreneur  makes 
more  than  the  margin  of  profits.  The  resulting  problem  and 
its  solutions  in  relation  to  wages  is  thus  discussed  in  "The 
Wage  Setting  Process,"  a  Bulletin  of  the  Federal  Board  for 
Vocational  Education: 

In  the  good  old  days  of  the  ruthless  captains  of  industry 
there  was  no  hesitation;  such  profits  were  all  sucked  up  by 
capital,  perhaps  by  even  an  inner  ring  of  capital  interests. 
But  the  public  mind  has  been  getting  sensitive,  so  that  a 
great  variety  of  subterfuges  of  financiering  and  corporate 
organization  have  been  invented  to  disguise  the  extent  of 
profits  in  the  public  eye.  It  is  realized  that  such  profits 
may  be  taken  by  the  State  through  the  machinery  of  taxa- 
tion. Or,  they  can  be  given  to  the  public  in  the  form  of 
lowered  prices  or  improved  service,  although  the  attempt 
to  do  this  results  in  increased  patronage,  and  so,  through 
lowered  costs,  works  a  return  of  all  or  part  of  the  benefit, 
and  may  even  open  a  vein  of  entirely  new  profit.  Yet 
again,  excess  profits  can  be  given  to  the  wage-earner  in 
improved  working  conditions,  personnel  service,  and  higher 
wages.  But  to  give  these  advantages  attracts  a  better  class 
of  labor,  evokes  loyalty,  and  reduces  labor  turnover,  so  that 
the  advantage  offered  tends  to  return,  like  bread  upon  the 
waters.  ...  It  is  becoming  a  sign  of  poor  management  and 
a  mark  of  disgrace  to  pay  low  wages. 

Manifestly,  the  question  of  the  apportionment  of  available 
assets  between  wages  and  profits  is  one  which  must  be  settled 
by  consultation  between  personnel  and  finance  departments. 
Whatever  policy  is  adopted  in  this  regard  will  affect  almost 
every  phase  of  employment  management. 

Relation  to  Other  Executive  Departments 

The  general  subject  of  the  relation  of  the  employment 
department  to  other  executive  departments  is  thoroughly 
treated  in  a  report  of  a  committee  on  organization  and  ad- 


PERSONNEL  DEPARTMENT  ORGANIZATION  251 

ministration  made  to  the  Seventh  Annual  Conference  of  the 
National  Association  of  Corporation  Schools,  June,  1919: 

That  a  specialized  department  of  executive  grade  has  not 
been  developed  generally  for  the  consideration  of  labor  rela- 
tions, is  largely  due  to  a  non-realization  of  the  close  relation- 
ship that  exists  between  the  various  parts  of  the  problem. 
Wage  systems  have  been  thought  of  as  separate  from  job 
analysis,  welfare  work  or  profit-sharing;  selection  of  em- 
ployees has  been  carried  on  without  thought  of  its  bearing 
upon  development  of  understudies,  adaptability  to  environ- 
ment or  special  fitness  for  the  work  to  be  done.  Labor  union 
policies  have  been  adopted  without  due  consideration  of  their 
effect  upon  the  internal  administration  of  employee  relation- 
ships which  may  have  a  bearing  upon  the  firm  or  upon  them- 
selves; educational  schemes  have  been  devised  with  slight 
consideration  of  the  close  connection  between  the  training  to 
be  given  and  the  methods  of  promotion,  compensation  and 
labor  turnover.  But  the  truth  is  gradually  forcing  itself 
upon  the  attention  of  the  corporations  that  these  problems 
are  all  interrelated,  and  that  the  only  insurance  against 
serious  ruptures  is  the  adoption  of  a  method  by  which  all 
these  activities  may  be  carried  on  under  a  common  adminis- 
trative policy. 

Correlation  of  Work  Within  Department 

The  work  of  correlation  is  not  wholly  with  outside  depart- 
ments. Personnel  work  consists  largely  in  the  organization 
and  harmonizing  of  the  elements  of  work.  It  knows  no 
panacea.  Perhaps  the  most  common  weakness  of  such  work 
is  its  lack  of  balance.  One  firm  devotes  all  attention  to  philan- 
thropic welfare,  another  makes  a  hobby  of  psychological  tests, 
a  third  has  a  fine  set  of  records  and  an  elaborate  promotion 
system.  Perhaps  none  of  these  policies  are  accompanied  by 
a  job  analysis  without  which  their  efficient  operation  is  impos- 
sible. A  fourth  has  a  pet  plan  of  joint  management,  adopted 
from  a  neighbor  without  regard  to  its  suitability  and  unac- 


252  PERSONNEL  RELATIONS   IN   INDUSTRY 

companied  by  any  of  the  other  essentials  of  good  employment 
practice.  Each  firm,  if  asked,  will  be  sure  that  it  is  using 
up-to-date  methods  of  employment  management. 

Yet  no  one  of  these  devices  or  methods  or  even  all  of 
them  together  will  produce  a  proper  personnel  department, 
unless  organized  into  a  single  working  mechanism.  The  cor- 
rectly assembled  and  correlated  whole  is  not  only  greater  than 
any  of  the  parts ;  it  is  the  only  machine  that  will  do  the  work. 

Selection,  routing,  records,  promotion,  training,  transfers, 
and  discipline  are  all  part  of  one  process.  The  physician  who 
has  charge  of  health  and  sanitation  should  also  understand  and 
co-operate  in  the  making  of  psychological  tests,  psychiatric 
examinations,  fatigue  studies,  and  job  analyses.  He  should 
direct  the  making  of  physical  examinations,  conduct  first-aid 
classes  and  co-operate  with  a  safety  committee  in  preventing 
accidents  and  occupational  diseases.  The  nurse  who  works 
in  his  department  is  a  most  important  link,  by  her  visits  to 
the  homes,  in  establishing  a  mutual  understanding. 

Medical  and  safety  work  are  closely  connected.  A  safety 
committee  should  be  taught  the  principles  of  factory  inspec- 
tion and  first  aid.  As  the  membership  of  such  committees 
changes,  the  number  so  trained  grows.  The  time  should  soon 
come  when  they  should  be  composed  of  experts  in  their  fields. 
Their  assistance  should  be  frequently  invoked  in  completing 
a  job  analysis.  It  is  a  general  principle  that  there  should 
be  no  "water-tight  compartments"  in  the  plant,  isolated  from, 
and  unrelated  to,  other  work.  The  tie  that  unites  is  the  human 
one,  and  the  personnel  department  deals  with  every  human 
relation. 

Plant  Education  and  Original  Research 

Education  and  training  are  natural  subdivisions  of  the 
personnel  department  and  are  intimately  related  to  selection, 
grading,  promotion,  and  the  cultivation  of  plant  loyalty.  One 


253 

important  feature  uniting  all  such  work  is  the  principle  that 
industry  must  furnish  a  life  career,  with  constant  growth  to 
each  person  who  enters  it.  Plant  training  should  extend  from 
the  removal  of  illiteracy  and  the  provision  for  apprenticeship 
training  to  the  most  advanced  research  work.  There  are 
plenty  of  examples  of  all  phases  of  such  work.  Unfortunately 
it  is  seldom  part  of  an  organized  plan  in  any  one  industry. 

Original  research  does  not  necessarily  require  a  university 
degree  for  preparation,  elaborate  laboratories  and  expensive 
technical  apparatus  for  its  work,  nor  unintelligible  vocabu- 
laries to  report  its  results.  Nearly  all  of  these  factors  may  be 
essential  accompaniments  to  the  research  work  of  certain  in- 
dustries, but  original  research  itself  is  something  very  dif- 
ferent and  much  more  fundamental.  It  consists  in  adding 
something  to  the  present  stock  of  human  knowledge.  This 
is  done  just  as  much  by  the  employee  who  finds  a  new  way 
to  handle  a  tool,  to  build  a  machine,  to  perform  an  industrial 
process,  or  to  route  work  through  a  plant,  as  by  the  scientist 
who  discovers  a  new  fact  about  the  operation  of  the  stomach 
of  the  parasite  on  the  shell  of  a  fresh- water  clam  and  writes 
a  doctor's  thesis  thereon.  The  methods  of  work  and  the 
mental  processes  are  the  same  in  both  cases.  There  is  the 
same  necessary  knowledge  of  previous  standards,  the  same 
careful  examination  of  facts  and  their  relations,  and  the  same 
testing  of  results.  A  committee  formed  to  hunt  out  possible 
improvements  in  shop  practice,  while  it  will  probably  use 
quite  a  different  vocabulary,  works  in  much  the  same  way 
as  a  graduate  seminar.  When  it  is  properly  organized,  the 
similarity  will  be  more  striking.  The  same  enthusiasm  will 
develop  and  the  results  will  be  at  least  equally  valuable. 

Equipment  for  Plant  Education 

A  personnel  director  bears  much  the  same  relation  to  a 
training  department  as  the  president  of  a  university  does 


254  PERSONNEL   RELATIONS   IN    INDUSTRY 

to  that  institution.  He  is  not  expected  to  know  all  the 
branches  taught,  but  he  should  know  when  good  work  is  being 
done  and  where  to  get  competent  teachers.  He  should  also 
see  that  the  equipment  for  plant  education  is  available.  This 
equipment  includes  a  library,  proper  periodicals,  and  such  in- 
formation service  as  may  be  needed.  It  is  his  business  to 
see  that  these  facilities  are  used.  There  is  a  technique  of 
their  distribution,  assignment,  and  handling  that,  if  used, 
greatly  increases  their  value.  Much  of  this  work  is  now 
highly  specialized.  In  some  fields  it  would  not  be  profitable 
for  any  ordinary  industry  to  retain  permanently  the  expert 
service  needed  to  establish  correct  methods.  The  personnel 
director  should  know  where  such  expert  service  is  required, 
where  it  can  be  obtained,  and  how  it  can  best  be  used. 

The  House  Organ 

The  house  organ  is  an  efficient  means  of  correlating  all  plant 
activities,  furthering  educational  work,  arousing  group  in- 
terest, and  disseminating  the  results  of  original  research.  Only 
within  very  recent  years  have  the  possibilities  of  such  organs 
begun  to  be  appreciated.  We  are  yet  far  from  utilizing  these 
possibilities  to  their  full  capacity.  Too  many  of  these  organs 
are  still  filled  with  "jollying,"  "inspirational"  baby-talk  that 
disgusts,  or  platitudinous  preaching  that  insults  the  intelli- 
gence and  revolts  the  instinct  of  self-respect.5  The  staff  of 
such  an  organ  should  be  drawn  from  the  working  force  of 
the  plant.  An  expert  newspaper  man  should  be  called  in  to 
teach  the  fundamental  principles  of  reporting,  copy  reading, 


"Those  plant  magazines  which  are  successful  are  built  of,  for  and 
by  the  men  themselves.  The  ones  that  fall  short  of  their  purpose  are 
often  made  up  of  inspirational  talks,  'welfare  stuff,'  laudation  of  the  com- 
pany and  plant  comics." — Ray  Dickinson,  Using  Art  and  Type  to  Build 
Industrial  Morale,  Printer's  Ink,  Feb.  1920.  pp.  24-26.  The  article  is  an 
excellent  study  of  the  house  organ  of  the  Hydraulic  Pressed  Steel  Com- 
pany. 


PERSONNEL   DEPARTMENT   ORGANIZATION  255 

make-up,  and  editorial  writing.  He  should  not  determine 
policy  nor  material,  unless  he  has  had  special  experience  in  the 
industrial  field. 

The  house  organ  should  be  thoroughly  departmentalized 
in  plan,  although  perhaps  not  in  make-up.  It  should  co- 
operate with  and  strengthen  the  work  of  the  "suggestion  box" 
or  research  department;  contribute  to  group  interest  by  unit- 
ing the  history  of  the  firm,  the  industry,  and  the  various 
products  to  the  work  on  hand;  and  furnish  the  actual  news 
of  the  industrial  group.  It  should  have  its  social  and  athletic 
departments,  its  open  forum,  and  its  editorial  page.  Its  con- 
tents should  not  be  assembled  as  a  scrapbook  is  assembled, 
but  should  be  balanced,  correlated,  and  organized  as  is  any 
good  periodical. 

The  Personnel  Director's  Job 

A  personnel  directorship  is  a  man's  sized  job.  Of  course  it 
is  sometimes  adequately  filled  by  a  woman.  The  more  the  job 
is  studied,  the  larger  it  appears.  Robert  G.  Valentine  has 
made  a  job  analysis  of  the  position,  and  listed  some  of  its 
qualifications:  * 

Don't  be  led  away  by  the  size  of  the  job  when  I  say  that 
the  head  of  the  personnel  division  of  a  concern  must  be 
actively  in  touch  with  economic,  industrial,  social  and 
political  forces  of  the  day;  he  must  be  alive  to  the  meaning 
of  trade  unionism ;  he  must  be  able  to  distinguish  between 
its  constructive  meaning  and  its  destructive  meannesses.  He 
must  be  equally  ready  to  admit  the  meannesses  of  his  fellow 
managers  and  anxious  about  their  constructive  side.  He 
must  be  alive  to  the  trend  of  even  the  humblest  business 
toward  a  status  in  the  public  service,  for  the  public  char- 
acter that  our  railroads  have  taken  will  be  rapidly  followed 
by  an  effective  public  interest  in  the  foods  we  eat  and  from 


'Bulletin  of  Taylor  Society,  Jan.  1915. 


256  PERSONNEL   RELATIONS   IN   INDUSTRY 

which  we  are  individually  powerless  to  bar  the  poison.  I 
am  not  asking  that  the  personnel  manager  shall  approve  of 
these  things.  It  is  not  a  question  of  approval  or  disapproval, 
but  he  must  be  alive  to  them.  So  he  must  be  alive  to  the 
growth  of  cooperation,  to  the  real  contribution  of  the  trusts, 
to  the  growth  of  consumer's  controls,  to  the  backwardness 
of  our  educational  system  as  a  whole  despite  its  noble  excep- 
tions. He  must  be  alive  still,  whether  he  agrees  or  not,  to 
"votes  for  women"  and  the  feminist  movement.  For  the 
personnel  manager,  in  order  to  be  fit  for  his  job  must  be 
an  industrial  counselor. 

Everyone  agrees  that  the  personnel  director  must  be  a 
good  judge  of  human  nature.  We  have  seen  that  human 
nature  is  not  an  indefinite,  esoteric  thing  to  be  judged  by 
some  sort  of  mystical  hocus-pocus.  Neither  is  the  power  to 
judge  it  a  mysterious  faculty,  peculiar  to  a  few  gifted 
geniuses.  Human  nature  can  be  analyzed  into  definite  ele- 
ments. This  analysis  is  not  made  by  guessing,  inspiration, 
or  intuition,  but  like  all  other  forms  of  scientific  analysis, 
by  hard,  careful,  systematic  work. 

The  psychologist  has  found  that  individual  human  nature 
is  a  complex  of  instincts,  habits,  abilities,  motives,  and  ambi- 
tions that  obey  definite  laws.  He  is  beginning  to  standardize 
the  methods  of  analyzing  that  complex  and  to  formulate  those 
laws.  The  psychiatrist  is  throwing  light  on  certain  abnormal 
phases  of  human  nature.  Tests  are  at  hand  by  which  to 
determine  abilities,  nervous  reactions,  and  mental  and  mus- 
cular fatigue. 

Dealing  with  masses  of  men  is  also  ceasing  to  be  a  mystery. 
It  is  not  a  matter  of  either  the  "glad  hand"  or  the  firm  hand, 
of  hurrahing  or  "handling."  We  are  ceasing  to  be  interested 
in  handling.  Attention  is  being  directed  to  organizing,  direct- 
ing, educating,  helping,  and  leading.  The  methods  of  doing 
this  are  based  somewhat  upon  group  psychology,  of  which 
more  may  be  known  in  the  future.  More  important  are 


PERSONNEL   DEPARTMENT  ORGANIZATION  257 

standard  systems  of  organization,  and  the  technique  of  man- 
agement compiled  or  extracted  from  a  mass  of  carefully  col- 
lected details  touching  all  the  various  points  of  contact  in 
industry.  Such  data  are  the  basis  of  the  profession  of  per- 
sonnel management. 

What  the  Director  Should  Know 

The  efficient  craftsman  in  this  occupation  must  have  a 
working  knowledge  of  economics;  especially  of  industrial  his- 
tory, wage  theories,  standards  of  living,  the  technique  of 
budget  statistics,  and  of  the  methods  of  making  and  handling 
index  numbers  and  other  forms  of  industrial  statistics.  He 
must  be  en  rapport  with  the  great  drama  of  the  evolution 
of  the  machine,  and  the  transformation  it  has  worked  in  the 
relations  of  the  human  elements  it  touches.  He  must  know 
something  of  the  era  of  craftsmanship  that  the  machine  sup- 
planted, and  the  society  that  rested  upon  it.  He  must  be  able 
to  express  graphically  the  great  aggregates  of  facts  relating 
to  industry.7 

Above  all  else,  his  work  deals  with  personnel — industrial 
personnel,  wage-earning  personnel.  He  must  know  the  labor 
movement,  its  history,  literature,  aspirations,  tactics,  forms  of 
expression,  and  worldwide  relations.  Lack  of  this  knowledge 
leaves  him  blind  to  some  of  the  most  important  phenomena 
with  which  he  must  deal.  He  must  know  the  story  of  the 
evolution  of  unions,  their  forms  of  organization,  their  methods 
of  bargaining,  their  ideals,  and  their  prejudices.  Whether 
any  particular  industry  is  organized  or  not,  it  is  still  true  that 
only  organized  labor  can  express  the  collective  mind  of  labor. 
Unorganized  units  have  no  collective  mind  and  no  means 
of  forming  or  expressing  such  a  mind.  Just  as  fast  as  hitherto 


T  Employment   Management,   Its   Rise  and   Scope,   Federal  Board   for 
Vocational  Education,   Bulletin  No.  50,  pp.  25-27. 


258  PERSONNEL   RELATIONS    IN    INDUSTRY 

unorganized  labor  finds  organized  expression,  it  develops  cer- 
tain common  ideas  and  aspirations  which  reach  across  every 
race,  religion,  nationality,  or  industrial  barrier.  Whether  to 
fight  or  to  favor  them,  these  common  thoughts  of  labor  must 
always  be  a  part  of  the  mental  make-up  of  a  competent  per- 
sonnel director. 

Such  a  director  should  know  enough  of  industrial  en- 
gineering and  scientific  management  to  know  whether  a  shop 
is  properly  organized  and  the  work  effectively  routed ;  whether 
the  planning  department  is  co-operating  with  him;  and  how 
time,  motion,  and  fatigue  studies  are  taken  and  used.  Though 
he  cannot  be  an  expert  in  all  these  lines,  he  can  know  the 
standard  literature  that  deals  with  them,  and  whether  the 
practice  in  the  shop  corresponds  to  that  of  the  approved 
standards  in  the  field.  He  need  not  know  all  the  trades  of 
the  employees  with  whom  he  works.  He  cannot  know  them 
all  in  a  large  establishment.  His  trade  is  something  different 
from,  yet  a  part  of,  all  of  them.  But  the  human  side  of  each 
trade  he  must  know.  The  tests  of  the  knowledge  needed  con- 
cerning each  occupation  are:  How  does  it  affect  the  human 
being  concerned?  What  time  is  needed  to  learn  it?  What 
fatigue  phenomena  does  it  produce?  What  are  its  oppor- 
tunities for  promotion?  The  list  of  questions  are  many  and 
form  the  foundation  of  a  thorough  job  analysis.  But  always 
he  searches  for  the  human  side. 

Contact  with  allied  activities  outside  the  plant,  of  which 
vocational  education  is  one,  must  be  close,  for  the  fields  over- 
lap and  complement  one  another. 

That  the  personnel  manager  should  know  the  technique 
and  the  trade  habits  of  his  own  profession  seems  self-evident, 
but  not  all  such  managers  know  the  best  systems  of  organizing 
their  own  work.  Not  all  of  them  route,  plan,  and  standardize 
the  activities  of  their  own  departments  before  seeking  out 
defects  of  standardization  and  planning  in  other  departments. 


PERSONNEL   DEPARTMENT  ORGANIZATION  259 

There  is  no  excuse  for  this  lack.    The  literature  here  is  ample 
and  the  standards  are  firmly  fixed. 

It  is  true  that  in  many  lines  of  personnel  work,  the 
activity  is  so  new  and  so  rapidly  growing  that  the  best  in- 
formation is  found  only  in  the  minds  of  the  men  and  women 
who  are  doing  the  work.  The  time  taken  to  write  it  makes 
it  out  of  date.  In  these  lines,  the  necessary  material  can  be 
obtained  only  through  close  touch  with  fellow-workers  in 
professional  associations. 


CHAPTER  XVI 
DEMOCRACY    IN    INDUSTRY 

Growth  of  Political  Democracy 

.Democracy  conquered  political  power  during  the  nine- 
teenth century.  It  is  now  spreading  into  other  fields.  The 
steps  and  the  methods  by  which  it  invaded  and  captured  the 
machinery  of  government  are  much  like  those  that  now  mark 
its  advance  into  the  field  of  industry.  Knowledge  of  the 
tactics  pursued  in  political  development  will  guard  against  mis- 
takes in  developing  industrial  democracy. 

Modern  democracy  is  almost  wholly  a  growth  of  the  last 
three  centuries,  and  largely  a  product  of  the  last  half  century. 
It  is  little  connected  with  earlier  democracies,  although  its 
first  friends  plentifully  interlarded  their  arguments  with 
quotations  drawn  from  the  experience  of  the  ancient  Greeks. 

The  method  of  advance  has  been  much  the  same  in  many 
states.  The  autocrat  was  forced,  by  the  very  multiplicity  of 
his  functions,  to  choose  and  trust  many  advisers.  The  growth 
of  great  nations,  following  the  Renaissance,  made  this  in- 
evitable. Even  a  Charles  V,  Philip  II,  or  Louis  XIV  could 
not  perform  alone  all  the  duties  of  his  office.  Once  these 
advisers  were  chosen,  it  became  the  fashion  to  blame  them 
for  all  mistakes  in  governmental  policy.  The  autocrat  was 
always  an  adept  at  what  modern  politicians  call  "passing  the 
buck."  In  no  other  way  could  he  maintain  the  fiction  that 
"the  king  can  do  no  wrong."  The  separation  of  power  and 
performance,  of  ruling  and  responsibility,  brought  important 
results.  Subjects  who  saw  an  adviser  deposed  as  a  sop  to 
popular  protest  soon  demanded  that  his  successor  should  be 

260 


DEMOCRACY   IN   INDUSTRY  261 

named  by   popular  vote.      So   absolute   sovereigns   became 
limited,  and  the  cabinet  system  of  government  was  born. 

Representatives  of  the  people,  who  were  first  assembled 
as  a  means  of  locating  those  able  to  pay  taxes  and  who  came 
unwillingly  for  that  purpose,  soon  learned  to  bargain  over  the 
form  and  amount  of  taxes.  Then  they  remained  to  make 
laws,  their  strength  derived  from  the  "power  of  the  purse." 
So  grew  parliaments. 

Diversity  of  Democratic  Institutions 

Democratic  institutions  are  still  unstandardized.  They 
display  all  the  diversity  of  growing  social  institutions.  Such 
common  and  fundamental  things  as  universal  suffrage,  secret 
ballot,  equal  representation,  and  the  whole  machinery  of  elec- 
tions are  comparatively  new  institutions.  Universal  manhood 
suffrage  came  to  the  United  States  largely  as  the  outgrowth 
of  a  labor  movement  about  a  century  ago.  Woman's  suffrage 
is  of  most  recent  date.  Most  voters  can  remember  the 
introduction  of  the  secret  Australian  ballot.  The  initiative, 
referendum,  recall,  and  direct  primary  are  still  on  trial  or 
just  taking  form. 

Nearly  all  democratic  governments  save  the  United  States 
are  of  the  cabinet  system.  This  makes  the  legislative  power 
supreme.  America,  almost  alone,  seeks  equilibrium  through 
a  system  of  checks  and  balances.  Other  political  democracies 
evolved  through  the  stage  of  constitutional  monarchy  and 
grew  by  limiting  the  power  of  the  hereditary  head.  Even 
where  the  hereditary  principle  was  abandoned,  the  elected 
chief  was  given  little  more  power  than  the  monarch  he  sup- 
planted. That  this  nation  alone  chooses  its  highest  official 
by  what  is  practically  a  popular  vote,  has  largely  determined 
the  form  of  our  political  institutions. 

There  are  striking  variations  within  the  United  States. 
Compare  the  government  of  North  Dakota,  under  the  Non- 


262  PERSONNEL   RELATIONS    IN   INDUSTRY 

Partisan  League,  with  that  of  New  York  or  South  Carolina. 
Contrast  the  multitudinous  commissions  and  elaborate  primary 
election  law  of  Wisconsin  with  the  legal  code  and  institutions 
of  Louisiana,  which  are  based  upon  the  customs  of  France. 

Method  of  Democratic  Advance  in  Politics 

Democracy  has  advanced  by  a  series  of  great  waves,  the 
first  of  which  reached  its  crest  with  the  Cromwellian  revolt 
of  1640.  This  had  been  preceded  by  an  emigration  to  America 
of  a  large  section  of  the  element  that  supported  Cromwell. 
The  long  period  of  reaction  which  came  with  the  restoration 
of  the  Stuarts  extended  to  the  American  colonies,  and  at  last 
aroused  our  democratic  revolt  of  1776.  A  spark  from  the 
American  Revolution  leaped  the  Atlantic  and  fired  the  ex- 
plosives beneath  the  old  regime  in  France.  Then  came  a  wave 
of  reaction  in  both  America  and  France. 

The  Chartist  movement  in  England  and  the  labor  and 
radical  movement  in  America,  during  the  twenties  and  thir- 
ties, were  the  first  signs  of  another  democratic  movement 
that  reached  its  culmination  in  the  Revolution  of  1848.  Before 
this  had  entirely  spent  its  force,  the  Italian  constitutional 
monarchy  had  arisen  in  1861  and  the  French  Republic  had 
been  established  in  1870. 

By  this  time  the  impulse  toward  democracy  was  so  strong 
as  to  be  almost  continuous.  There  have  been,  however,  two 
fairly  well-marked  phases  of  the  onward  sweep.  The  first 
was  the  rise  of  the  working  class  in  all  western  nations. .  The 
second  sprang  out  of  the  Great  War,  with  its  dependence  upon 
industrial  conditions  and  continuous  appeals  for  popular  sup- 
port. 

Shifting  Emphasis  to  Industrial  Democracy 

The  field  has  been  shifted  to  industry  in  these  two  phases. 
Here  the  same  alternations  and  the  same  Protean  expressions 


DEMOCRACY   IN   INDUSTRY  263 

may  be  expected.    Cyrus  H.  McCormick,  Jr.,  notes  the  resem- 
blance in  an  address  before  the  National  Safety  Council:  1 

There  is  a  close  parallel  existing  between  the  movement 
in  favor  of  employee  representation  and  the  growth  of 
democratic  government.  Europe  in  the  i8th  century  con-  / 
sidered  Frederick  the  Great's  government  too  nearly  ideal. 
Later  thinkers  have  called  his  government  a  benevolent  despo- 
tism. Frederick  was  as  autocratic  as  any  Czar  and  his  form 
of  government  a  despotism;  but  because  he  tried  to  do  right 
and  interpret  in  the  fairest  sort  of  way  the  desires  of  his  peo- 
ple, his  despotism  was  benevolent.  Now  until  recent  years  our 
industrial  system  was  also  a  benevolent  despotism.  Large 
employers  in  this  country  and  abroad  instituted  welfare 
work,  started  systems  of  insurance  and  compensation,  made 
the  conditions  of  their  working  people  as  safe  and  pleasant 
as  possible;  but  everything  that  was  done  was  paternally 
imposed  from  the  top  and  did  not  come  as  the  expressed 
desire  of  the  great  body  of  employees.  The  system  was 
benevolent,  to  be  sure,  but  it  was  nevertheless  despotic  to 
a  great  extent.  Just  as  benevolent  despotism  in  politics  has 
given  way  to  a  great  democracy  wherein  the  governed  have 
every  right  of  self-expression,  so  in  industry  we  are  now 
finding  the  old  system  being  set  aside.  Now  the  employee 
is  not  only  given  the  right,  but  is  urged  to  accept  it,  to  sit 
on  an  equal  basis  with  his  employer  and  decide  every  ques- 
tion which  affects  his  interests.  Industry  is  becoming 
democratic. 

The  currents  that  unite  to  make  this  great  tide  are  many 
and  various.  Labor  early  learned  to  use  political  democracy 
to  improve  industrial  conditions,  and  the  great  wave  of  social 
legislation  which  began  in  the  middle  of  the  nineteenth  century 
has  become  a  dominant  feature  of  the  political  life  of  all 
modern  nations,  mitigating,  confining,  and  regulating  the  bit- 
ter industrial  struggles.  Such  legisation  derives  its  strength 


1  Scientific  American,  Feb.  7,  IQ2O. 


264  PERSONNEL   RELATIONS   IN   INDUSTRY 

from  many  sources.  In  part  it  is  due  to  the  growing  political 
power  of  labor,  and  is  largely  an  expression  of  the  fact  that 
the  group  mind  is  always  much  better  or  worse  than  the 
minds  of  the  individuals  who  compose  it.  In  the  group,  each 
one  seeks  to  accentuate  those  characters  that  bring  group 
approval.  The  community  condemns  conditions  in  industry 
that  many  of  its  members  endure  without  protest  or  maintain 
for  profit.  Social  legislation  restricted  child  labor,  improved 
housing,  regulated  hours,  provided  better  conditions  in  work- 
places, increased  safety,  kept  children  in  school,  and  in  a 
multitude  of  other  ways  emphasized  the  human  element  in 
industry. 

An  accompaniment  of  social  legislation  in  some  places 
has  been  the  development  of  joint  bodies  for  the  administra- 
tion of  labor  laws.  These  boards,  composed  of  an  equal 
number  of  representatives  of  employers  and  employees,  have 
arrived  at  common  conclusions  of  a  more  progressive  char- 
acter than  was  generally  anticipated — a  further  proof  of  the 
characteristics  of  group  psychology  just  mentioned  and  also 
the  herald  of  wider  possibilities  in  joint  action. 

Science  and  Democratic  Industrial  Control 

The  "benevolent  despotism"  of  the  factory  led  to  the 
same  end.  Welfare  plans,  managed  from  above,  revolted  the 
instinct  of  self-respect  and  aroused  antagonism  rather  than 
good-will.  Then  employees  were  invited  to  co-operate. 
Safety  campaigns  succeeded  only  when  directed  by  joint  com- 
mittees. This  successful  co-operation  pointed  out  the  road 
to  democracy  and  persuaded  the  management  of  its  desir- 
ability. 

We  have  watched  scientific  management  come  close  to 
shipwreck  on  the  autocratic  rock,  and  then  sail  swiftly  on 
before  the  democratic  breeze.  But  scientific  management  in 
the  technique  of  production  did  something  else,  without  which 


DEMOCRACY   IN   INDUSTRY  265 

industrial  democracy  is  impossible.  It  helped  introduce  the 
idea  of  law  into  industrial  relations.  Chance,  trial  and  error, 
violent  struggle,  lead  straight  to  autocracy.  Democracy  must 
be  based  upon  law.  It  must  have  a  foundation  of  standard- 
ized, tested,  and  classified  facts  reduced  to  laws,  upon  which 
all  can  agree  to  build.  It  is  not  by  accident  that  the  growth 
of  modern  science  precedes  democracy  everywhere.  Disputes 
about  facts  cannot  be  compromised.  Until  they  are  settled 
scientifically  there  is  no  ground  upon  which  to  build  common 
action. 

The  first  workers  in  the  field  of  scientific  management 
tried  to  ignore  the  democratic  implications  of  science.  Their 
successors  know  better.  Today  every  industrial  engineer 
bases  his  work  upon  co-operation  with  all  the  human  elements 
involved.  He  has  become  the  firmest  friend  of  industrial 
democracy.  The  moment  the  methods  of  science  were  ex- 
tended directly  to  the  problems  of  personnel  relations,  it 
was  inevitable  that  democracy  should  follow.  Every  step  in 
adjustment,  promotion,  introduction,  training,  and  discipline, 
according  to  scientifically  established  standards  of  justice  and 
economy,  involved  a  corresponding  extension  of  democracy. 
It  also  made  that  extension  possible  by  laying  its  scientific 
foundation. 

Growth  of  Joint  Management 

Organized  labor  had  a  great  part  in  preparing  the  way 
for  joint  management  in  industry.  The  union  movement 
taught  the  workers  to  think  and  act  together.  It  led  them 
to  study  industrial  problems.  In  developing  leadership  for 
fighting,  it  trained  leaders  for  industry.  Through  collective 
bargaining,  the  machinery  of  joint  management  and  its  in- 
stitutions was  evolved.  That  machinery  has  been  tested  under 
every  imaginable  condition,  in  literally  millions  of  varying 
situations  in  every  industrial  nation.  In  such  industries  as 


266  PERSONNEL   RELATIONS   IN   INDUSTRY 

coal  mining,  printing,  the  building  trades,  and  the  manu- 
facture of  clothing,  democratic  institutions  of  great  impor- 
tance and  varied  complexity  and  efficiency  have  long  func- 
tioned. 

Had  we  traced  the  origin  of  political  democracy  in  detail, 
we  should  have  found  similarly  varied  sources.  We  must, 
therefore,  expect  that  industrial,  even  more  than  political, 
democracy  will  be  a  growth  presenting  multiform  variations. 
Success  is  apt  to  follow  this  law  of  variation  in  growth.  This 
opinion  is  confirmed  by  William  R.  Basset,  who  says  in  his 
book,  "When  the  Workmen  Help  You  Manage": 

It  is  well,  I  find,  to  start  with  a  single  committee  to 
adjust  some  particular  trouble,  and  then,  keeping  that  com- 
mittee standing,  gradually  to  enlarge  its  powers  until  the 
time  comes  for  another  committee.  The  whole  Filene  plan 
grew  out  of  a  dispute  with  a  girl  cashier  over  a  shortage 
for  which  she  claimed  she  was  not  responsible.  She  said 
that  any  fair-minded  outsider  would  agree  with  her,  and 
the  store  manager  took  her  at  her  word  and  selected  an 
umpire.  The  umpire  sustained  the  girl;  and  from  that  in- 
cidental beginning  grew  the  whole  of  the  plan  that  is  in 
force  today. 

It  is  not  necessary  and  it  is  not  advisable  unless  a  com- 
pany is  face  to  face  with  an  emergency  such  as  a  strike, 
to  do  more  than  cut  corners  at  the  very  start;  and  then 
gradually  a  system  which  exactly  fits  that  shop  will  develop 
in  good  time. 

That  plan  is  strongest  which  has  the  greatest  elasticity; 
therefore  the  design  should  be  laid  out  in  bold  free  strokes 
and  not  in  detail.  Definitions  of  powers,  exact  procedures, 
and  minute  regulations  should  form  no  part  of  the  eventual 
constitution  or  other  instrument  which  may  be  adopted.  It 
is  really  better  to  follow  the  British  example  and  make  the 
constitution  consist  of  the  body  of  laws  and  resolutions 
which  are,  from  time  to  time  passed.  An  exact  definition 
of  a  power  strikes  some  bumptious  human  chord  that  makes 
exceeding  that  limitation  the  only  act  worth  while. 


DEMOCRACY   IN   INDUSTRY  267 

Phases  of  Joint  Management 

Experiment  has  now  proceeded  far  enough  to  prove  the 
practicability  of  some  forms  of  joint  management,  and  it 
would  be  as  foolish  to  overlook  these  standardized  institu- 
tions as  it  would  be  to  enter  recklessly  upon  the  unstandard- 
ized  field. 

The  roads  along  which  democracy  is  entering  the  indus- 
trial domain,  and  the  successive  fields  conquered,  are  now 
well  charted.  It  already  has  control  of  many  phases  of  fac- 
tory surroundings.  Only  the  foolish  clingers  to  autocracy! 
object  to  employees'  sharing  in  the  control  of  light,  heat,  sani-1 
tation,  and  safety  regulations.  There  is  really  no  way  to| 
shut  them  out.  These  things  are  coming  more  and  more 
under  the  regulation  of  government,  and  the  employees  are 
citizens. 

A  suggestion  box  without  joint  control  soon  devolutes 
into  innocuous,  or  rather,  pernicious  desuetude.  Confidence 
and  constructive  interest  flourish  only  when  the  suggestions 
are  passed  upon  and  the  rewards  determined  by  a  joint  body. 
Without  such  control,  stories  soon  begin  to  float  about  to 
the  effect  that  valuable  inventions  have  been  stolen  from 
employees.  It  is  of  little  importance  whether  such  stories  are 
true  or  false;  they  will  effectively  dam  up  the  flow  of  sug- 
gestions. 

Training  is  impossible  without  plant  co-operation.  All 
forms  of  education  are  of  prime  interest  to  the  person  to 
be  educated.  He  should  certainly  share  in  the  control  of  any 
such  education.  If  he  does  not,  the  cost  of  training  will  be 
increased  and  its  value  diminished. 

Discipline  offers  a  debatable  ground.    Old-style  employers  i 
look  for  the  world  to  resolve  into  original  chaos  if  they  cease 
to  "run  their  own  business"  and  to  hire  and  fire  as  they 
please.    Autocrats  have  always  believed  this ;  they  have  always 
been  wrong  in  the  past;  they  probably  are  now.     Experience 


268  PERSONNEL  RELATIONS  IN  INDUSTRY 

indicates  that  every  extension  to  this  field  brings  greater,  be-    , 
cause  more  intelligent,  order  into  industry. 

Collective  Bargaining 

Having  come  this  far  into  the  "water,"  there  is  generally 
less  hesitation  about  taking  the  plunge  that  places  questions 
of  wages,  hours,  methods  of  payment,  and  conditions  of  labor 
under  joint  management.  It  is  foolish  to  dodge  the  issue 
by  claiming  an  identity  of  interest  at  all  points.  Investigation 
has  shown  less  antagonism  on  questions  of  high  wages,  short 
hours,  and  efficient  production  than  both  sides  have  antici- 
pated. 

But  there  is  a  point  beyond  which  wages  cannot  be 
raised  and  hours  shortened  without  damage  to  the  interests 
of  the  employer,  just  as  it  is  possible  to  push  production  to 
the  point  where  the  laborer  is  overworked.  Of  course  it  is 
tru^e  that  in  the  long  run  the  employee  is  not  interested  in 
destroying  or  crippling  the  industry,  or  the  employer  in  in- 
juring the  worker.  But  we  seldom  wait  for  "the  long  run" 
when  our  immediate  interests  are  touched. 

The  fairest  view  is  to  admit  the  antagonistic  interests  and 
determine  whether  they  are  to  be  settled  by  fighting  or  by 
bargaining.  Joint  management  is  continuous  collective  bar- 
gaining. It  places  all  cards  upon  the  table,  permits  no  masked 
batteries,  no  camouflaged  mines,  and  tries  every  possible 
.method  before  resorting  to  a  test  of  strength.  Experience 
shows  that  when  this  is  done  there  are  few,  if  any,  occasions 
for  fighting. 

Nevertheless,  a  warning  should  be  sounded  against  the 
idea  that  joint  management  is  the  panacea  for  all  industrial 
troubles.  Unless  some  unforeseen  age  of  miracles  lies  before 
us,  there  will  be  failures  and  disappointments  in  this,  as  in 
all  other  fields  of  social  change.  Wide  knowledge  and  careful 
consideration  of  all  steps  will  minimize  these  failures  and 


DEMOCRACY  IN  INDUSTRY  269 

make  them  the  stepping-stones  to  more  nearly  perfect  insti- 
tutions. 

Joint  Control  of  Finance  and  Sales 

Present  plans  of  joint  management  almost  universally 
exclude  financing  and  sales.  Yet  even  in  these  fields,  the 
efficiency  and  desirability  of  permanent  autocracy  is  ques- 
tioned The  sphere  of  the  state  in  both  fields  is  extending. 
Experiments  like  the  Emergency  Fleet  Corporation2  and  the 
War  Finance  Board  on  the  one  hand,  and  the  growth  of 
the  federal  bank  system  in  the  control  of  credit  on  the  other, 
with  the  development  of  such  institutions  as  the  farm  loan 
banks,  indicate  that  finance  will  not  henceforth  be  purely  a 
matter  of  private  management.  Restrictions  in  other  direc- 
tions, illustrated  by  "blue  sky"  laws  and  by  the  ever-growing 
publicity  demanded  for  corporation  accounts,  emphasize  this 
tendency.  Modern  efficiency  insists  that  credit  shall  be  based 
upon  ability  and  not  upon  possession.  We  cannot  permit 
financiers  ignorant  of  the  essentials  of  efficient  production,  to 
sabotage  industry  and  restrict  production  by  the  autocratic 
distribution  of  credit.  Some  banks  already  investigate  the^ 
efficient  use  of  men  and  machines,  and  the  extent  of  industrial/' 
good-will,  as  important  elements  in  making  up  bankable  assets. 
We  shall  see  that  in  Great  Britain  the  Building  Trades  Joint 
Council  has  already  gone  far  toward  joint  management  of 
finance  to  the  satisfaction  of  all  concerned. 

Sales  are  also  related  to  production.  This  may  bring  them 
under  joint  control.  Manufacturing  to  suit  fads  means 
irregular  employment.  Joint  management  is  apt  to  insist  upon 
so  organizing  the  sales  department  as  to  give  greater  stability 
and  regularity. 

Purchasing  of  material,  and  locating  and  extending  the 


JH.  L.  Gantt,  Organizing  for  Work,  1919,  pp.  8,  22. 


270  PERSONNEL   RELATIONS   IN   INDUSTRY 

plant,  are  subjects  that  so  far  have  not  been  included  under 
joint  management. 

Steps  in  the  Change 

Because  of  the  importance  of  the  change  from  autocratic 
to  democratic  control  and  the  lack  of  standardization,  each 
step  requires  care.  Joint  management  is  not  a  fad,  a  patent 
medicine,  or  a  cure-all  to  be  taken  at  a  dose.  It  should  be 
based  upon  thorough  education  of  the  personnel,  and  especially 
of  the  foremen.  It  is  not  only  necessary  that  they  be  con- 
vinced of  the  desirability  of  the  plan;  they  should  know  how 
it  works  and  its  relation  to  every  plant  problem.  Lack  of 
this  knowledge  leads  to  an  indifference  more  deadly  than 
hostility,  or  to  focusing  all  attention  upon  one  or  two  phases, 
such  as  wages,  welfare,  or  safety. 

The  plan  should  fit  the  plant.  Industries  differ  far  more 
than  political  units.  To  try  to  fit  them  all  to  one  scheme 
is  to  follow  the  Bolshevik  idea  that  all  problems  are  conjured 
away  by  the  word  "Soviet." 

Any  form  of  faking  is  fatal.  As  William  M.  Leiserson 
says:  3 

Any  employer  who  is  not  ready  for  collective  bargaining, 
who  is  not  looking  toward  turning  over  to  his  employees 
fifty  per  cent  of  his  control  over  terms  and  conditions  of 
employment,  had  better  beware  of  shop  committees.  If  he 
desires  merely  to  improve  the  personal  relations  between 
his  management  and  his  men,  if  he  wants  only  to  be  brought 
into  closer  contact  with  his  employees  for  the  purpose  of 
insuring  a  square  deal  to  them  as  he  sees  it,  if  he  wants  to 
see  that  justice  is  done  to  every  employee  as  he  sees  justice, 
then  all  he  needs  is  a  good  employment  and  service  organiza- 
tion. 


*W.  M.  Leiserson,  Organizing  the  Working  Force,  Industrial  Man- 
agement, June,  1919,  p.  503. 


DEMOCRACY   IN   INDUSTRY  271 

No  scheme  should  posit  finality.  The  gateway  to  amend- 
ment should  be  kept  wide  open.  Each  change  should  be  thor- 
oughly discussed,  but  there  should  be  no  walls  barring 
progress.  If  any  are  built  they  will  be  violently  assaulted. 
A  corollary  of  this  principle  requires  that  the  plan  should 
be  a  joint  product.  It  should  come  from  a  "constitutional 
convention"  in  which  the  employees  and  management  are 
equally  represented. 

Principles  of  the  Works  Council 

The  "Works  Council  Manual,"  issued  by  the  National 
Industrial  Conference  Board,  summarizes  these  principles  as 
follows : 

First:  The  Works  Council  being  a  living  organism  and 
not  a  mere  mechanism,  cannot  be  set  up  as  a  piece  of 
machinery  might  be  installed.  Its  introduction  necessitates 
a  "readjustment  of  certain  human  relations;  its  successful 
operation  requires  the  presence  of  a  favorable  environment. 
Attention  must  be  given  to  these  considerations  as  well  as 
to  the  features  of  the  plan  itself. 

Thus  it  has  proved  to  be  primarily  important  that  those 
plant  executives  who  come  into  intimate  contact  with  the 
employees,  and  who  are  to  be  directly  concerned  in  the 
operation  of  the  plan,  shall  possess  the  proper  attitude  and 
personality.  They  must  be  in  accord  with  the  idea  of  the 
Works  Council;  they  must  be  sympathetic  and  tactful  in 
dealing  with  the  men.  Also  experience  indicates  that  a 
Works  Council  is  likely  to  meet  with  success  only  where 
there  exists  a  feeling  of  confidence  in  the  plan  on  the  part 
of  both  management  and  men.  Without  these  conditions 
Works  Council  may  fail  of  its  purpose,  however  perfectly 
its  organization  is  planned. 

Second:  Since  industrial  establishments  differ  greatly  in 
size,  personnel  of  management,  composition  of  working 
force,  and  other  important  particulars,  an  individual  plan  of 
organization  needs  to  be  developed  for  each  establishment. 
To  follow  rigidly  a  set  formula  or  a  so-called  "model"  plan 


272  PERSONNEL  RELATIONS   IN   INDUSTRY 

is  almost  certainly  to  encounter  difficulties.  No  one  form 
of  organization  and  no  one  mode  of  procedure  is  applicable 
to  all  establishments  alike. 

Third:  A  Works  Council,  being  a  human  institution,  can- 
not be  so  planned  in  advance  as  to  meet  all  contingencies. 
Even  after  all  possible  care  and  foresight  have  been  exer- 
cised, many  details  of  organization  necessarily  remain  to  be 
developed  in  operation.  The  Works  Council,  therefore, 
should  be  left  sufficiently  flexible  to  permit  of  adaptation  to 
environment. 

Fourth:  Since  the  Works  Council  is  essentially  a  means 
of  affording  representation  to  the  employees  of  an  establish- 
ment, it  is  obviously  desirable  that  they  should  participate 
in  the  development  of  the  plan.  A  Works  Council  instituted 
without  consultation  with  the  employees  is  likely  to  be 
unrepresentative  or  at  least  to  be  regarded  as  such.  The 
best  results  generally  have  been  obtained  where  the  plan  of 
representation  has  been  introduced  with  the  cooperation 
and  express  approval  of  the  employees. 


CHAPTER  XVII 

FORMS    OF   JOINT    MANAGEMENT 

The  Leitch  Plan 

Two  distinct  types  may  be  distinguished  in  the  midst  of 
the  diversified  plans  known  as  joint  management.  What  is 
known  as  the  governmental  type  is  largely  the  creation  of 
John  Leitch.  It  is  not  properly  a  plan  of  joint  management 
at  all.  ,  Its  author  seems  sometimes  opposed  to  the  idea  of 
joint  councils,  although  he  constantly  refers  to  his  system  as 
that  of  "industrial  democracy."  It  has,  nevertheless,  fre- 
quently developed  joint  organs  and  sometimes  grown  into 
genuine  joint  management.  Therefore  its  treatment  belongs 
here. 

The  plan  is  modeled  directly  after  that  of  the  national 
government  of  the  United  States.  There  is  a  "house  of  repre- 
sentatives," generally  elected  by  a  mass  meeting  of  all  the 
employees  below  the  rank  of  foreman.  The  "senate"  is 
ordinarily  elected  by  superintendents  and  foremen. 

Application  of  Leitch  Plan 

In  the  Demuth  Pipe  Works,  the  qualifications  for  voters 
for  the  lower  house  are  one  year's  employment  by  the  firm, 
and  ability  to  speak  English  and  to  "be  on  the  square."  The 
latter  qualification  is  characteristic.  Phrases  are  substituted 
for  exact  definitions  and  scientific  accuracy.  In  addition  to 
the  senate,  composed  of  superintendents,  heads  of  depart- 
ments, and  factory  foremen,  the  Demuth  plan  provides  for  a 
"cabinet,"  composed  of  members  of  the  executive  board,  to- 
gether with  factory  and  sales  managers.  The  president  of 
the  corporation  presides  over  the  sessions  of  the  cabinet. 

273 


274  PERSONNEL   RELATIONS   IN   INDUSTRY 

In  the  Goodyear  Rubber  Company,  the  plan  is  still  further 
complicated  by  the  provision  in  the  constitution  that,  "On 
matters  of  joint  interest  to  men  and  management,  such  as 
wage  adjustments,  working  conditions  and  the  adjustment  of 
'grievances/  joint  conferences  may  be  called  where  represen- 
tatives of  the  men  meet  an  equal  number  of  representatives 
of  the  management."  Here  is  manifestly  the  beginning  of 
joint  management.  The  vice-president  of  the  firm  further 
describes  the  composition  of  these  joint  conferences,  as  fol- 
lows: 1 

The  industrial  assembly  shall  appoint  6  industrians,  3 
from  the  senate  and  3  from  the  house,  and  the  factory 
management  shall  appoint  6  industrians,  to  meet  as  a  "joint 
conference."  Persons  thus  selected  shall  be  duly  accredited 
representatives  of  the  Goodyear  factory  men  and  manage- 
ment for  consideration  of  and  cooperation  upon  subjects 
of  mutual  interest. 

In  this  plarit,  also,  all  members  of  the  house  and  senate 
are  "elected  by  a  direct  vote  of  the  plant  citizens — industrians, 
as  they  are  called.  .  .  .  The  senate  does  not  represent  one 
class  of  workers  and  the  house  another,  as  they  do  under  some 
of  the  plans  that  we  studied.  Both  represent  all  the  workers. 
The  convention  tried  as  far  as  possible  to  avoid  ranging  class 
against  class  anywhere  in  the  system."  2 

In  the  American  Multigraph  Company's  plan  there  is  not 
only  a  house,  senate,  and  cabinet,  but  also  a  "supreme  court." 
This  is  established  "for  the  purpose  of  acting  as  a  court  of 
appeals  or  to  interpret  the  articles  that  are  provided  for  the 
new  form  of  management.  This  court  will  consist  of  three 
members  of  the  employees'  Congress,  three  members  of  the 

1  P.  W.   Litchfield,   vice-president  Goodyear   Tire   and   Rubber   Com- 
pany, Employees  Who  Govern  Themselves,  System,  Mar.  1920,  p.  476. 
*Ibid.,  p.  475. 


FORMS   OF  JOINT   MANAGEMENT  275 

Senate,  and  three  members  of  the  President's  cabinet  The 
majority  vote  of  this  Supreme  Court  will  carry  with  it  its 
endorsement  of  any  matter  that  comes  before  it." 

The  plan  is  varied  in  another  way  in  the  plant  of  the  Carr 
Brothers  Hosiery  Company  of  Durham,  North  Carolina,  by 
making  the  cabinet  consist  of  "the  four  Carr  brothers  and  the 
chief  superintendent  of  the  mills." 

Weaknesses  of  Plan 

In  all  respects  there  is  lack  of  standardization  in  the  appli- 
cation of  the  governmental  plan  as  described  above.  Nor  is 
this  seemingly  due  alone  to  variations  in  the  problems  to  be 
met.  It  seems  to  be  due,  in  part  at  least,  to  loose  thinking, 
and  to  a  tendency  to  depend  upon  phrases  and  inspirational 
talks  rather  than  exact  knowledge.  For  example:  The  whole 
plan  is  repeatedly  stated  to  rest  upon  four  great  fundamental 
principles — justice,  co-operation,  economy,  service.  There 
seems  to  be  a  sort  of  ritual  of  installation,  in  which  a  series 
of  "sermonettes"  upon  these  words  plays  an  important  part. 
This  is  a  poor  foundation  upon  which  to  build.  The  words 
are  not  inclusive  of  all  the  virtues.  They  are  particularly 
difficult  to  apply.  On  all  really  vital  questions  each  side 
believes  itself  to  be  applying  them,  with  directly  opposite  con- 
clusions. 

There  is  one  phase  of  the  Leitch  plan  of  which  its  author 
says  little,  but  which  seems  to  be  a  really  important  and  dis- 
tinctive characteristic.  This  is  the  bonus  or  profit-sharing 
attachment.  Leitch  describes  the  method  by  which  he  intro- 
duced this,  as  follows: 

I  told  them  that  they  were  going  to  save  money  under 
the  new  plan — that  they  were  going  to  get  more  work  done ; 
that  it  would  not  be  a  square  deal  for  the  company  alone 
to  take  the  money  that  they  had  saved  but  instead  that  we 
would  split  up  the  savings  50-50,  that  is,  as  the  books  of  the 


276  PERSONNEL   RELATIONS   IN   INDUSTRY 

company  showed  savings  in  the  cost  of  operation,  the  amount 
saved  would  be  divided  into  two  parts — one  would  go  to  the 
company  and  the  other  would  be  distributed  every  two 
weeks  to  the  men  as  a  dividend  on  wages. 

This  bonus  system  contains  all  the  weaknesses  of  regular 
profit-sharing  systems,  plus  some  additional  ones  peculiar  to 
itself.  It  assumes,  without  investigation,  that  the  employees 
are  responsible  for  at  least  fifty  per  cent  of  all  the  elements 
that  contribute  to  profits.  But  we  have  already  seen  that  only 
one  of  these  many  elements  are  in  any  important  degree  within 
the  control  of  the  employees.  ( See  pages  2 1 2-2 13.)  Moreover, 
it  is  doubtful  if  even  the  most  perfect  system  of  accounting 
is  able  to  state  every  two  weeks  just  what  changes  have  taken 
place  in  the  cost  of  production.  We  are  moving  toward  such 
perfection  of  accounting,  but  it  is  dangerous  to  depend  upon 
the  systems  that  are  found  in  most  industries  at  the  present 
time.  Other  and  important  pitfalls  will  beset  such  a  scheme 
when  profits  are  declining  or  absent. 

Governmental  versus  Joint  Council  Method 

Leitch  has  been  a  pioneer  in  many  lines  of  industrial 
organization.  He  has  written  much  that  is  fundamentally 
good  upon  industrial  democracy.  This  should  not  blind  the 
observer  to  the  weaknesses  of  his  methods.  The  criticism 
of  W.  L.  Stoddard  would  seem  to  be  fully  justified.  He 
says:* 

The  shop  committee  system  of  government  does  not 
resemble  the  kind  of  representative  government  which  we 
have,  for  example,  in  the  United  States.  The  theory  of  the 
American  government  is  that  the  people  elect  their  servants 
whose  duty  it  is  to  make  and  execute  laws  under  a  constitu- 
tion, which  in  turn  can  be  changed  by  the  people.  The 

'W.  L.  Stoddard,  Shop  Committee,  1919. 


FORMS   OF   JOINT   MANAGEMENT  277 

theory  of  the  shop  committee  system  form  of  government 
is  that  the  employees  elect  their  representatives  who  meet 
with  an  equal  number  of  representatives  of  the  management. 
Thus  in  the  United  States  government  there  is  only  one 
source  of  power,  the  people.  In  the  shop  committee  system 
government,  there  are  two  sources  of  power.  This  is  what 
is  commonly  called  "joint  control,"  and  the  various  branches 
of  the  government  are  called  "joint  committees." 

Leitch  insists  that  his  plan  is  preferable  to  one  involving 
joint  action.  He  considers  shop  committees  only  a  means  of 
hearing  and  adjusting  complaints,  and  says:  * 

The  settling  of  disputes  is,  of  course,  interesting,  and 
undoubtedly  is  convenient,  but  it  is  not  progress.  It  does 
not  help  anyone  to  be  encouraged  to  air  his  troubles.  If  you 
organize  a  factory  with  the  idea  in  mind  that  the  people 
have  been  brought  there  primarily  to  have  their  grievances 
settled  rather  than  to  work,  then  you  are  promoting  an 
undoubtedly  interesting  clinic  in  hypochondria.  I  think  the 
results  of  shop  committees  or  other  bodies  organized  solely 
on  this  basis  bear  out  my  statement. 

My  procedure  is  quite  the  opposite.  I  want  to  give 
responsibility  for  constructive  action  and  then  the  com- 
plaints and  differences  which  arise  are  viewed  by  the  people 
not  merely  as  disputes,  but  as  impediments  to  progress  and 
are  to  be  treated  as  such. 

Certainly  the  joint  committee  that  confines  itself  to  hear- 
ing complaints  is  a  negative  force  of  no  positive  value.  No 
properly  conducted  works  council  does  this.  It  is  not  a  ques- 
tion of  whether  such  a  constructive  attitude  should  be  main- 
tained, but  whether  the  "governmental"  or  the  "joint  council" 
method  is  the  best  instrument  for  constructive  purposes. 

The  "Works  Council  Manual,"  gives  its  opinion  on  this 
point  as  follows: 


4  John  Leitch,  Background  of  Industrial  Democracy,  Annals  of  the 
American  Academy,  Sept.  1919,  p.  208. 


278  PERSONNEL   RELATIONS    IN   INDUSTRY 

As  between  the  separate  and  joint  forms  of  Works 
Councils,  the  latter  appears  to  have  the  advantages.  The 
joint  Works  Council,  comprising  representatives  of  the  em- 
ployees and  the  management,  tends  to  develop  in  both  a 
sense  of  their  mutuality  of  interest.  As  a  result  its  activities 
are  more  likely  to  be  of  a  cooperative  and  constructive 
nature.  Obviously,  agreement  between  the  parties  should 
be  facilitated  by  reason  of  the  fact  that  the  representatives 
of  both,  meeting  in  joint  session,  hear  the  full  facts  concern- 
ing matters  under  discussion  before  they  are  required  to 
take  a  position.  Each  set  of  representatives,  however, 
should  be  free  to  meet  separately,  since  an  opportunity  for 
either  group  to  talk  over  a  matter  among  themselves,  follow- 
ing joint  discussion,  may  often  facilitate  a  settlement.  More- 
over, such  a  provision  preserves  the  separate  entity  of  the 
two  parties  where  their  interest  may  be  in  conflict 

The  Shop  Committee 

The  committee  type  alone  starts  with  the  view  of  estab- 
lishing joint  management  As  yet  its  organs  and  methods 
of  work  are  far  from  standardized.  Almost  every  imaginable 
form  is  being  tried  somewhere.  Methods  of  election,  meet- 
ing, representation,  nomination,  procedure,  organization,  as 
well  as  the  powers  of  the  various  bodies,  differ  in  detail  from 
plant  to  plant 

It  is  not  necessary  for  each  new  firm  to  repeat  all  this 
experimenting.  Familiarity  with  results  already  attained 
greatly  lessens  cost  and  danger  of  failure.  Yet  these  details 
are  not  unimportant.  The  question  of  whether  representatives 
shall  be  elected  at  large  or  from  departments  depends  upon 
the  size  and  make-up  of  the  industry.  In  a  small,  homo- 
geneous force,  election  by  a  mass-meeting  may  be  simplest  and 
best.  In  a  large  and  diversified  industry,  districting  is  impera- 
tive. The  districting,  however,  is  not  something  to  be  done 
carelessly.  Bad  districting  in  a  plant  may  start  as  much 
trouble  ana  work  as  much  injustice  as  gerrymandering  a  state 


FORMS   OF  JOINT   MANAGEMENT  -279 

for  political  advantage.  Departments  are  jealous  of  their 
own  autonomy.  Each  one  wishes  a  representative  familiar 
with  the  work  and  problems  in  that  department,  and  this  is 
a  useful  spirit  to  cultivate.  It  is  an  outgrowth  of  the  group 
instinct  which  may  be  made  most  helpful  in  a  genuine  organ- 
ization of  industry. 

Departmental  Representation  on  Councils 

But  as  departments  often  vary  greatly  in  size,  this  inter- 
feres with  numerical  equality  in  electoral  representation  and 
is  a  cause  of  complaint.  So  departments  must  often  be  divided 
and  combined.  Intelligent  districting  requires  a  competent 
'employment  department,  job  analyses,  standardization  of 
wages,  classification  of  positions,  and  complete  organized 
knowledge  of  the  functions,  differences,  and  peculiarities  of 
the  different  departments. 

The  plan  of  the  Nunn-Bush  Cooperative  Association  of 
Milwaukee  provides  for  the  election  of  one  representative 
from  each  of  the  twelve  departments  of  the  shoe  factory  in 
which  the  plan  operates.  The  whole  organization  grew  out 
of  an  elaborate  mutual  benefit  association,  to  which  the  com- 
pany makes  large  contributions.  A  peculiarity  of  this  organ- 
ization is  the  office  of  chairman  of  the  shop  committee,  who 
devotes  his  entire  time  as  a  representative  and  "business 
agent"  of  the  employees.  He  receives  a  salary  from  the 
council  and  not  from  the  firm.  The  employee  members  of  the 
joint  council  are  chosen  by  the  shop  committee  of  twelve. 

The  Bethlehem  Steel  Company,  International  Harvester 
Company,  Colorado  Fuel  and  Iron  Company,  and  several 
other  firms  have  plans  providing  for  the  election  of  repre- 
sentatives to  a  joint  works  council  directly,  by  departments. 
All  these  plans,  however,  differ  greatly  in  other  details. 

Another  type  of  departmental  plan  of  joint  management 
is  based  upon  divisional  committees.  These  are  generally 


280  PERSONNEL   RELATIONS  IN  INDUSTRY 

elected  by  departments  and  are  assigned  the  duty  of  dealing 
directly  with  such  minor  questions  as  may  arise  within  the 
division. 

In  some  forms  of  this  plan  the  total  membership  of  all 
divisional  committees  forms  the  works  council.  This  is  the 
method  followed  by  the  Bridgeport  Brass  Company  Repre- 
sentatives equal  in  number  to  those  elected  by  the  employees 
are  named  by  the  employers  for  each  divisional  committee. 
The  works  council  or  plant  committee  chooses  five  members 
to  serve  with  five  management  representatives  as  an  executive 
committee. 

Philadelphia  Rapid  Transit  Company  Plan 

The  plan  of  the  Philadelphia  Rapid  Transit  Company 
presents  many  peculiarities.  Its  employees  are  divided  into 
many  classes  according  to  occupation,  and  also  according  to 
the  stations,  or  depots,  and  the  divisions  of  the  road  to  which 
they  are  attached.  Each  of  these  classes  forms  a  district, 
electing  two  representatives,  and  with  two  persons  named  by 
the  employers,  the  four  form  a  branch  committee.  "At  least 
once  in  every  three  months  there  shall  be  an  opportunity  for 
a  meeting  of  workers  at  each  Branch,  when  reports  shall  be 
made  by  the  local  Branch  Committeemen."  5 

These  branch  committees  then  combine  to  form  depart- 
ment committees.  There  are  five  of  these,  classified  as  trans- 
portation, rolling  stock  and  buildings,  electrical,  way,  and 
general  offices  departments.  "The  members  of  each  Depart- 
ment Committee  for  Employees  shall  -annually  elect  two  of 
their  number,  the  members  so  elected  to  constitute  the  General 
Committee  for  Employees."  This  committee  has  power  to 
review  all  matters  dealt  with  by  the  department  committees. 

'The   Cooperative   Plan,   issued  by  the  Philadelphia   Rapid   Transit 
Company,  p.  17. 

•Ibid.,  p.  22.  * 


FORMS  OF  JOINT  MANAGEMENT  281 

In  case  of  disagreement  and  the  impossibility  of  arbitra- 
tion through  arbitrators  chosen  by  the  two  sides,  the  agree- 
ment provides  that  the  provost  of  the  University  of  Penn- 
sylvania, the  chairman  of  the  Public  Service  Commission,  and 
the  president  of  the  Chamber  of  Commerce  shall  serve 
as  "additional  arbitrators.  Failing  unanimous  decision,  the 
decision  of  any  three  of  these  five  arbitrators  shall  be 
binding." 

The  plan  is  also  'coupled  with  an  elaborate  "Co-operative 
Welfare  Association,"  which  is  "administered  by  a  Co-opera- 
tive Council  consisting  of  the-  combined  membership  of  the 
two  General  Committees  for  Collective  Bargaining.  The 
administration  of  the  Co-operative  Welfare  Association  shall 
be  entirely  separate  and  distinct  from  the  function  of  collec- 
tive bargaining."  7 

Fundamental  Principle  of  All  Plans 

The  various  plans  installed  by  the  War  Labor  Board  have 
a  common  outline.  The  works  council  is  formed  out  of  the 
chairmen  of  divisional  committees.  If  there  are  less  than 
ten  of  these  committees,  the  entire  membership  unites  to  form 
the  works  council. 

Relations  with  the  unions  led  to  a  later  development  in 
the  Bethlehem  Steel  Corporation  and  American  Ship  Building 
Company.  The  works  council  has  been  enlarged  by  the  elec- 
tion of  five  representatives  from  the  Metal  Trades  Depart- 
ment of  the  American  Federation  of  Labor  and  the  appoint- 
ment of  an  equal  number  by  the  management. 

Many  minor  variations  of  all  these  types  can  be  described 
as  now  being  tested  out  somewhere.  Sometimes,  as  will  be 
seen  later,  apparently  insignificant  changes  produce  most  im- 


TThe  Cooperative   Plan,   issued  by  the   Philadelphia   Rapid   Transit 
Company,  p.  29. 


282  PERSONNEL   RELATIONS   IN   INDUSTRY 

portant  results.  In  all  cases  where  joint  management  is  based 
on  works  councils,  the  fundamental  principle  is  the  meeting 
in  the  works  council  of  equal  numbers  of  representatives  of 
employees  and  management.  Stoddard  rightly  says  concern- 
ing this  feature : 

The  joint  meeting  is  the  characteristic  thing  about  the 
shop  committee  form  of  industrial  government.  It  is  more 
than  characteristic,  it  is  fundamental.  The  entire  purpose 
of  shop  committee  systems  is  to  bring  employer  and  em- 
ployee face  to  face.  To  the  minds  of  some  keen  employers 
and  employees  this  movement  means  a  return  to  the  "good 
old  days"  when  industry  was  small  and  the  general  manager 
personally  knew  Tom  Jones  in  the  foundry  and  dealt  with 
him  man  to  man,  instead  of  through  the  medium  of  half  a 
hundred  subordinates.  How  to  reestablish  this  kind  of  rela- 
tionship in  modern  industry  has  been  a  problem  which  has 
puzzled  many  of  the  leaders  in  the  world  of  labor  as  well 
as  in  the  world  of  capital.  At  a  critical  time  in  the  history 
of  industry  throughout  the  world  the  shop  committee  offers 
itself  as  a  solution  of  this  problem.  By  setting  up  a  simple 
plan  of  internal  shop  government  on  the  principles  just  out- 
lined, something  of  the  old  small  shop  atmosphere  can  be 
regained.  The  sense  of  aloofness  between  employer  and 
employee  vanishes  when  the  manager  realizes  that  his  re- 
sponsible agents  are  meeting  daily  with  the  men  in  com- 
mittee sessions;  and  when  the  men,  for  their  part,  realize 
that  the  management  believes  that  the  rank  and  file  should 
have  a  say  in  the  way  the  business  is  managed. 

Powers  of  Works  Councils 

Powers  of  works  councils  vary  as  greatly  as  their  forms. 
Some  have  almost  no  power.  There  are  not  lacking  instances 
where  employers  characterize  as  "industrial  democracy"  the 
',appointment  of  committees  by  the  management  to  report 
grievances  or  recommend  safety  appliances. 

Experience  now  indicates  lines  of  possible  standardization 
of  powers.  In  the  most  successful  plans,  wages,  piece-rates, 


FORMS   OF   JOINT   MANAGEMENT  283 

working  conditions,  promotion  and  discharge  are  subject  to 
the  decision  of  the  joint  bodies.  The  National  Industrial 
Conference  Board  found  38  out  of  145  joint  councils  dealing 
with  matters  of  wages,  hours,  piece-rates,  and  similar  basic 
matters.  If  these  are  excluded  the  council  has  no  foundation 
upon  which  to  build  its  work  and  to  retain  the  interest  of  its- 
members. 

But  these  disputed  questions  should  not  be  the  end  of  the 
powers  of  joint  management.  They  should  be  the  beginning. 
Industry  is  conducted  for  production.  Joint  management 
must  meet  this  test.  If  it  does  not  produce  the  results  ex- 
pected, it  is  because,  in  many  instances,  the  management  still 
thinks  of  itself  as  a  fighting  organization  seeking  to  capture 
the  present  product,  not  an  organizing,  directing  body  seeking 
to  increase  further  production. 

Effect  of  Joint  Management  on  Management  Staff 

Even  the  latest  models  of  joint  management  are  not  yet 
equipped  with  self-starters.  A  management  that  is  too  lazy 
or  indifferent  to  do  a  lot  of  cranking  had  better  not  invest 
in  a  works  council. 

Joint  management,  so  far  from  reducing  the  functions  of 
the  management  staff,  extends  them  into  new  fields  and  calls 
for  largely  increased  abilities.  Foremen,  superintendents,  and 
higher  executives  must  now  become  real  "labor  leaders." 
They  must  constitute  a  general  staff  for  the  planning  o! 
production  campaigns.  These  campaigns,  moreover,  are  no 
longer  to  be  tried  out  without  examination  or  criticism.  They 
must  be  so  well  constructed  that  they  will  stand  the  test  of 
intelligent  democratic  discussion. 

The  management  must  continue  to  lead,  but  only  by  virtue 
of  its  ability  to  keep  ahead.  It  must  be  prepared  to  present 
plans  of  production ;  10  organize  original  research  throughout 
the  plant;  to  cultivate  every  form  of  desirable  talent;  to 


284  PERSONNEL  RELATIONS   IN   INDUSTRY 

present  proposals  for  training  in  every  field;  to  anticipate 
demands  for  promotion;  and  to  develop  such  systems  of 
promotion  as  will  meet  with  democratic  approval.  Such  work 
calls  for  a  highly  trained  management.  Few  managers  really 
know  how  to  organize  men,  materials,  and  machines  without 
autocratic  driving.  Many  of  them  do  not  as  yet  even  realize 
that  with  such  driving  there  is  really  no  organization.  An 
organization  is  something  that  derives  its  vitality  from  within 
and  not  from  without. 

Only  when  works  councils  have  plenty  of  work  do  they 
retain  the  interest  of  the  worker,  or  produce  anything  of 
value.  Where  they  are  started  as  a  fad,  a  weapon,  or  as 
an  excuse,  they  are  very  apt  to  degenerate.  In  far  too  many 
cases  they  have  been  started  as  weapons  against  organized 
labor. 

The  investigation  of  the  National  Industrial  Conference 
Board  reports  little  definite  effect  produced  in  this  direction. 
Unions  come  and  grow,  wax  and  wane,  just  about  the  same 
under  works  councils  as  without  them.  There  are  important 
and  fundamental  changes  produced  in  the  form  and  attitude 
of  the  unions,  but  this  is  to  be  discussed  later. 

Effect  of  Joint  Management  on  Workers 

The  fuller  the  program  of  work  of  the  joint  council,  the 
greater  the  educational  value,  and  the  greater  its  contribution 
to  management.  Those  who  have  studied  the  movement  most 
closely  see  it  following  the  line  that  democracy  has  always 

1  "Those  who  may  be  considering  such  a  plan  must  make  up  their 
minds  to  go  into  it  completely  or  not  at  all.  The  plan  must  be  broad 
if  it  is  to  be  democratic,  and  if  it  is  not  broadly  democratic  it  cannot 
succeed.  The  time  may  come  when  the  employees  will  wish  to  share 
in  the  executive  management  of  a  business.  This,  however,  will  be  a 
matter  for  generations  of  education  and  development;  at  the  present 
time  no  one  except  the  syndicalist  is  demanding  participation  in  the  man- 
agement except  as  it  affects  the  interests  of  the  men." — Cyrus  H.  McCor- 
mick,  Jr.,  Cooperation  and  Industrial  Progress,  Scientific  American, 
Feb.  1920. 


FORMS   OF   JOINT   MANAGEMENT  285 

taken  and  extending  to  ever  wider  and  wider  fields.8    Ordway 
Tead  foresees  that:  9 

As  soon  as  the  workers  realize  that  they  do  have  a  voice 
in  determining  the  conditions  of  the  new  factory  with  which 
their  livelihood  is  tied  up,  they  will  see  new  points  of  attack. 
They  will  want  low  unit  costs.  When  that  point  is  reached 
the  game  is  up,  from  the  point  of  view  of  autonomous  shop 
control.  Problems  of  research  into  process,  introduction  of 
new  machinery  with  the  maintenance  of  wages  as  high  for 
machine  feeders  as  for  replaced  craftsmen,  training-in  of 
new  workers,  the  price  of  raw  material,  the  effectiveness  of 
the  sales  organization,  and  economy  in  securing  credit — 
these  are  a  far  cry  from  a  modest  proposal  of  departmental 
representation  on  a  joint  shop  board  which  is  to  discuss 
"grievances."  But  these  are  the  very  matters  that  determine 
low  unit  costs.  The  day  is  gone  when  the  workers  or 
anyone  else  will  submit  to  wage  reductions  in  order  to  lower 
costs.  This  is  a  lazy  and  incompetent  way  to  attempt 
economies.  It  will  not  be  the  way  adopted  in  any  plant 
where  the  shop  committee  is  a  living  force. 


Employers,  especially  those  who  are  fearful  of  union 
encroachments  and  attempts  of  "agitators  to  run  my  busi- 
ness," must  understand,  then,  that  in  their  plans  of  em- 
ployees' representation  they  are  not  merely  creating  an 
organ  of  orderly  adjustment  and  amicable  cooperation. 
They  are  giving  play  to  impulses  of  self-direction,  leader- 
ship and  assertiveness  in  their  workers,  which  will  not  stop 
at  some  point  which  the  employer  has  arbitrarily  set  in  his 
own  mind.  They  are  creating  machinery  in  the  operation 
of  which  the  workers  will  inevitably  come  to  see  how 
closely  their  destinies  are  linked  up  with  the  problems  of 
tariffs,  sources  of  raw  material,  unit  costs  of  production 
and  all  the  other  elements:  They  are  showing  the  workers 
that  if  an  equality  of  bargaining  power  does  not  exist  within 
one  plant  much  can  be  done  to  remedy  the  inequality  by. 

'Ordway    Tead,    Criticism    of    the   Whitley    Report,    New    Republic, 
Feb.  8,  1919. 


286  PERSONNEL   RELATIONS    IN   INDUSTRY 

affiliation   with   the  workers   in   other   plants   in   the   same 
industry. 

Constitutionalism  in  industry  is  about  to  involve  pre- 
cisely what  it  has  involved  in  political  affairs — a  hierarchy 
of  representative  bodies,  each  concerned  with  the  problems 
which  the  size  and  character  of  its  administrative  unit 
requires.  In  this  scheme  of  things  the  shop  committee  will 
necessarily  have  a  significant  place — a  place  at  the  base 
of  the  pyramid  which  culminates  in  joint  national  industrial 
councils  and  in  international  labor  commissions.  It  cannot 
permanently  be  an  instrument  to  thwart  labor  organization 
|  or  to  entrench  the  employer  more  fully  in  ultimate  authority. 
The  shop  committee  can  and  should,  on  the  contrary,  per- 
form one  inestimable,  valuable  and  immediate  function.  It 
should  contribute  to  the  building  up  of  a  spirit  of  mutual 
understanding  and  personal  confidence  strong  enough  to 
make  the  transition  to  bargaining  with  labor  unions  a  normal 
and  a  natural  transition  in  which  all  values  are  retained  and 
others  added. 

Adjustment  of  Minor  Disagreements 

Most  plans  provide  for  some  sort  of  preliminary  discus- 
sion and  adjustment,  through  simple  departmental  machinery. 
Usually  the  representatives  to  the  shop  council  or  divisional 
committee  take  the  matter  up  before  any  formal  move  to  set 
the  general  machinery  in  motion  is  made.  This  disposes  of 
the  majority  of  all  difficulties.  As  time  passes,  the  number 
of  grievances  that  go  up  to  the  joint  body  for  formal  con- 
sideration decreases.  Each  side  learns  what  rules  will  be 
applied  and  what  decision  given  in  certain  classes  of  difficul- 
ties, and  applies  these  rules  at  once. 

This  first  adjustment  should  be  as  informal  as  possible. 
Subsequent  moves  may  well  be  surrounded  with  considerable 
formality.  Statements  should  be  reduced  to  writing  and  sup- 
ported by  witnesses.  This  very  transformation  from  informal 
to  formal  action  prevents  petty  disagreements  from  being  car- 
ried into  the  general  body. 


FORMS   OF  JOINT   MANAGEMENT  287 

Final  Means  of  Adjustment 

Most  systems  of  joint  management  provide  for  some  final 
court  of  adjustment.  That  provided  by  the  Nunn-Bush  Com- 
pany and  the  Philadelphia  Rapid  Transit  Company  has  already 
been  described.  The  International  Harvester*  plan  climaxes 
in  a  general  council  of  all  the  works,  and,  if  this  fails  to 
decide,  in  arbitration  by  a  mutually  chosen  body.  The 
Colorado  Fuel  and  Iron  Company  provides  that  final  appeal 
shall  be  to  the  State  Industrial  Commission. 

Many  plans  specifically  reserve  final  decision  to  the  board 
of  directors.  Of  course,  behind  every  plan,  as  behind  every 
treaty  between  nations,  there  is  always  the  possibility  of  a 
reversion  to  primitive  conflict.  All  that  can  be  done  is  to 
create  all  possible  and  desirable  machinery  for  the  expression 
in  regulated  form  of  divergent  opinion,  thus  controlling  the 
fighting  instinct  before  resorting  to  the  strike,  lockout,  or 
other  forms  of  struggle.  As  already  noted,  the  tendency  is 
for  government  to  provide  voluntary,  impartial  tribunals  for 
the  handling  of  the  questions  to  which  joint  management  does 
not  supply  an  answer. 

Qualifications  for  Voters 

Qualifications  for  voters  and  committee  members  vary 
greatly.  Most  plans  require  a  certain  length  of  employment, 
a  minimum  age  of  about  eighteen,  and  ability  to  speak  the 
English  language.  Some  add  American  citizenship  and  a 
higher  degree  of  literacy.  Foremen,  and  all  who  have  the 
power  of  hiring,  discharge,,  or  discipline,  are  excluded  from 
voting.  The  management  chooses  its  representatives  from 
these.  It  is  suggestive  of  thought  that  usually  all  the  repre- 
sentatives who  meet  in  a  works  council  are  really  taken  from 
among  the  employees.  Ownership  is  seldom  directly  repre- 
sented. It  chooses  its  representatives  from  the  executive  staff. 

All  plans  throw  careful  safeguards  around  the  methods 


288  PERSONNEL   RELATIONS   IN   INDUSTRY 

of  nomination  and  election.    The  least  suspicion  of  influence 
here  vitiates  the  entire  plan. 

Regularity  in  the  meetings  of  the  works  council  is  im- 
portant. Meetings  should  be  carefully  arranged  for,  and  their 
proceedings  should  not  be  permitted  to  drift.  It  should  be 
the  definite  task  of  someone,  preferably  connected  with  the 
personnel  department,  to  ascertain  the  questions  each  depart- 
ment desires  to  discuss  and  prepare  an  order  of  business.  It 
would  be  well  to  have  a  similar  representative  of  the  employees 
who  would  make  sure  that  matters  of  interest  to  the  employee 
representatives  are  not  only  upon  the  program  but  are  pre- 
pared for.  Meetings  are  usually  held  during  working  hours 
and  on  company  time.  Where  labor  is  well  organized  and 
the  instinct  of  self-respect  highly  developed,  the  unions  often 
insist  upon  paying  their  representatives  and  holding  the  meet- 
ings off  the  plant  and  outside  of  working  hours. 

Efficiency  and  Production 

Objections  to  joint  management  follow  closely  the  type 
of  those  always  directed  against  democracy.  It  is  charged 
with  lack  of  efficiency.  In  one  point,  that  of  quickness  of 
decision,  democracy  is  undoubtedly  inferior  to  autocracy. 
Where  secrecy  and  aggression  in  fighting  are  essentials  of 
survival,  democracy  is  at  a  disadvantage.  The  continuous  vic- 
tories, however,  of  democracy  over  the  earlier  and  strongly 
entrenched  autocracy,  indicate  that  its  slower  decisions  con- 
tain fewer  errors.  Democratic  decisions,  when  made,  have 
behind  them  the  driving  momentum  of  the  mass,  which 
autocracy  lacks.  As  production  rather  than  fighting  comes 
to  be  the  essential  purpose  of  industry,  the  advantage  of 
democracy  increases. 

Joint  management  will  ultimately  focus  all  the  minds 
within  the  plant  upon  the  problems  common  to  the  producing 
group.  Then  the  results  will  be  proportionate  to  the  ability 


FORMS  OF  JOINT  MANAGEMENT         289 

and  training  of  those  minds.  Democracy  demands  and  implies 
education.  This  is  as  true  industrially  as  politically,  a  fact 
apt  to  be  overlooked  or  neglected  by  both  political  and  indus- 
trial autocracy.  Democracy  in  industry  calls  for  industrial 
training  of  all  citizens  and  expert  training  of  all  officials. 
This  expert  training  must  not  be  confined  to  trade  skill.  It 
must  include  training  in  group  leadership,  arousing  of  crafts- 
manship, organizing  of  labor  for  production,  and  knowledge 
of  the  proper  relations  between  men,  methods,  material,  and 
machines. 

There  should  not  be  too  great  haste  to  secure  increased 
production.  Dale  Wolf  of  the  Miller  Lock  Company,  Phila- 
delphia, rightly  characterizes  increased  production  from  shop 
committees  as  a  by-product.  He  says:  10 

A  factory  starts  an  advertising  campaign,  little  it  knows 
what  will  be  the  results.  When  you  start  a  shop  committee 
you  start  an  advertising  campaign  among  your  workers  to 
up-grade  the  morale.  Propaganda  would  be  a  better  word. 
If  you  want  your  shop  committee  to  stimulate  production 
I  believe  that  you  must  hook  up  directly  to  the  work  of 
the  committee  some  definite  financial  incentives  to  the 
workers.  This  will  create  and  instill  the  confidence  of  the 
workers  in  their  committee. 

Stimulated  production  is  a  by-product,  if  you  please, 
of  the  shop  committee.  Don't  start  to  get  your  shop  com- 
mittee to  increase  production.  Let  it  do  the  work  that  has 
been  laid  out  for  it,  then  you  will  get  increased  production 
as  a  by-product.  Have  an  honest-to-goodness  shop  commit- 
tee, one  that's  on  the  square,  and  don't  feel  sore  if  you  can't 
see  the  point  where  it's  increasing  production.  Such  work 
will  come  around.  You  don't  generally  start  to  manufacture 
a  by-product,  certainly  not;  the  by-product  comes  after  you 
start  the  main  product  through  the  factory. 


"Dale  Wolf,  Shop  Committees  and  Stimulated  Production,  Iron  Age, 
April  8,  1920,  pp.  1030,  1031. 


CHAPTER  XVIII 

UNION    CONTRIBUTIONS    TO   JOINT 
MANAGEMENT 

Original   Object   of  Joint   Management 

Many  employers  undoubtedly  adopted  joint  management 
with  the  hope  of  weakening  the  fighting  strength  of  the 
unions.  Simultaneously  the  unions  have  been  moving  in  the 
same  direction,  with  the  object  of  decreasing  the  power  of 
the  employer.  Paradoxical  as  it  sounds,  each,  in  reaching  the 
goal  aimed  at,  has  found  it  to  be  wholly  different  from  what 
it  appeared  at  the  start.  The  fighting  strength  of  each  con- 
testant has  been  weakened,  not  by  direct  assault,  but  by  the 
abandonment  of  previously  valued  weapons  as  no  longer 
necessary. 

Collective  bargaining  has  always  been  a  form  of  joint 
management.  But  it  has  always  been  looked  upon  as  a  truce 
in  the  midst  of  fighting,  a  treaty  dividing  the  spoils  of  one 
war  and  laying  the  ground  for  the  next.  It  developed  the 
machinery  for  battle  consciously  and  intentionally.  It  evolved 
machinery  for  co-operation  unconsciously  and  almost  as  a 
by-product. 

Such  institutions  as  the  two  "houses"  of  the  miners,  meet-^ 
ing  each  year  in  Springfield,  Illinois,  to  draft  a  joint  agree-; 
ment,  helped  to  build  the  institutions  of  industrial  democracy. 
Yet  they  were,  and  still  are,  organized  primarily  for  fighting.}/ 
But  they  began  to  fight  without  violence,  with  the  treaty  as 
well  as  the  victory  in  sight.    They  also,  like  many  other  unions 
and   employers'   organizations,   evolved  machinery   for  joint 
enforcement   of   the   agreement.      But   this   machinery   still 

290 


UNIONS   AND   JOINT   MANAGEMENT  291 

watched  from  opposite  sides,  preparing  always  for  the  next 
struggle.  It  was  necessary  for  some  industry  to  break  out  of 
this  circle. 

Conditions  in  Garment  Trades 

The  garment  trades  were  successful  in  doing  this.  Yet 
anyone  who  had  observed  this  trade  twenty  years  ago  would 
have  said  that  it  would  be  the  very  last  trade  from  which 
leadership  in  orderly  development  could  be  expected.  Julius 
H.  Cohen,  attorney  for  the  employers,  in  his  standard  history 
of  the  critical  years  of  organized  development,  "Law  and 
Order  in  Industry,"  says:  * 

The  industry  is  a  style  industry.  It  is  also  a  seasonal 
industry.  This  makes  it  a  part  of  the  great  unemployment 
problem  of  the  country.  .  .  .  But  because  it  is  a  seasonal 
industry,  there  is  feverish  work  for  six  months  and  com- 
parative idleness  for  the  rest  of  the  year  and  obviously 
twelve  months'  overhead  charges  for  six  months  of  opera- 
tion. 

The  rents  are  enormously  high.  Factory  must  be  near 
salesrooms.  The  successful  manufacturer  is  at  once  sales- 
man, designer,  factory  manager,  financier  and  industrial 
expert.  High  priced  lofts  near  the  city's  hotel  and  railroad 
centers  offer  him  his  only  opportunity. 

The  shops  were  small.  Any  employee  could,  by  saving  a 
few  dollars,  rise  to  the  condition  of  manufacturer  within  a 
short  time.  The  labor  force  was  recruited  from  an  ever- 
rising  flood  of  unassimilated  immigrants,  unable  to  bargain 
upon  an  equality  with  the  employers.  These  immigrants  were 
mostly  Italians  and  Jews,  intensely  temperamental  and  impul- 
sive. This  characteristic  was  naturally  accentuated  by  the 
miserable  conditions  under  which  they  were  forced  to  live. 

*J.  H.  Cohen,  Law  and  Order  in  Industry,  1916,  p.  86. 


292  PERSONNEL   RELATIONS   IN   INDUSTRY 

A  large  portion  of  the  work  was  done  in  the  homes,  through 
subcontractors.  Thus  developed  the  infamous  "sweating  sys- 
tem" that  became  the  superlative  expression  with  which  to 
describe  the  worst  industrial  conditions. 

A  larger  percentage  of  these  workers  were  followers  of 
some  revolutionary  philosophy  than  are  to  be  found  in  any 
other  industry.  To  a  righteous  sense  of  revolt  against  unbear- 
able conditions,  they  added  an  elaborate  doctrine  of  revolu- 
tionary action.  Such  union  organization  as  they  possessed 
was  of  a  spasmodic  character.  It  was  formed  only  for  fight- 
ing. It  was  met  with  a  similar  unreasoned  belligerency  on 
the  part  of  the  employers. 

During  the  late  nineties  I  was  personally  brought  into  close 
contact  with  what  was  called  the  "great  sweatshop  strike"  in 
Chicago.  I  visited  many  of  the  homes  of  the  strikers.  I  saw 
children  literally  starve  to  death,  families  disrupted,  men 
driven  to  suicide,  and  a  bitterness  of  class  hatred  such  as  it 
would  be  hard  to  parallel.  That  strike,  like  several  others, 
was  lost,  the  union  was  smashed,  and  it  seemed  that  the  condi- 
tion of  antagonism  was  to  be  perpetual. 

Cohen  describes  the  situation  in  New  York  a  few  years 
later:2 

Anarchy  on  the  workers'  side  was  matched  by  anarchy 
on  the  employers'  side.  The  difference  was  one  of  kind 
and  degree.  In  the  case  of  the  employers  it  was 
anarchy  in  the  sense  of  lawlessness  in  their  competition 
with  each  other  and  in  their  unwillingness  to  abide  by  the 
rules  of  their  own  making.  ...  In  1907,  1908,  and  1909  a 
union  of  cloak  manufacturers  was  something  to  poke  fun 
at.  ... 

The  trade  union  does  not  owe  its  origin  to  the  decent 
employer,  considerate  of  the  well-being  of  the  workers  in 
his  shop.  The  real  propagandist  for  trade  unionism  is  the 


*J.  H.  Cohen,  Law  and  Order  in  Industry,  1916,  pp.  4-6. 


UNIONS   AND  JOINT   MANAGEMENT  293 

employer  who  is  not  yet  past  the  kindergarten  stage  of  shop 
morality.  .  .  .  He  literally  makes  the  existence  of  a  trade 
union  possible,  for  without  him  there  would  be  no  union. 
His  grasping,  his  tyranny,  his  indifference  to  the  ordinary 
human  rights  of  workingmen  and  women  make  the  basis  of 
factory  laws,  industrial  commissions,  and  clear  the  field  for 
I.  W.  W.  radicals. 


The  merry  game  went  on,  each  side  lying  in  wait  for 
the  other.  Employers  freely  signed  contracts  with  the 
union,  guaranteeing  fine  wages  and  good  conditions.  The 
ink  was  scarcely  dry  before  they  became  mere  scraps  of 
paper.  The  new  standards  were  secured  at  great  sacrifice. 
During  a  strike  the  working  people  were  enthusiastic  union 
members,  literally  ready  to  die  for  their  union.  As  soon 
as  the  paper  was  signed  and  peace  was  declared,  they  lost 
interest,  failed  to  attend  meetings,  and  the  union  lapsed  into 
decay,  to  be  revived  only  through  another  strike. 

The  Fight  for  the  Closed  Shop 

Finally,  in  1910,  the  union  felt  itself  strong  enough  to 
demand  the  closed  shop.  For  the  fighting  type  of  union  this 
demand  is  fundamental.  Without  it  there  is  no  means  of 
insuring  good  faith  in  the  keeping  of  bargains,  or  maintain- 
ing the  instrument  without  which  no  new  bargain  can  be 
made. 

The  New  York  manufacturers  rejected  the  demand,  and  the 
fight  was  on.  The  strike  threatened  to  last  through  the  entire 
working  season.  It  was  feared  that  this  would  destroy  the 
industry.  Negotiations  were  finally  opened  through  Louis 
D.  Brandeis,  now  a  Justice  of  the  United  States  Supreme 
Court.  At  the  first  meeting  he  suggested  that  all  other  mat- 
ters in  dispute  be  discussed  before  the  subject  of  the  closed 
shop  was  approached.  This  was  done.  As  discussions  pro- 
ceeded, one  after  another  of  the  items  relating  to  wages,  hours, 
and  working  conditions  were  adjusted. 


294  PERSONNEL  RELATIONS   IN   INDUSTRY 

The  Garment-Workers'  Protocol 

In  the  process  of  this  adjustment,  a  new  form  of  joint 
agreement  was  evolved — the  once  famous  "protocol."  There 
were  several  new  features  to  this  agreement  that  have  had 
important  results.  It  fixed  no  period  of  termination;  instead 
it  required  six  months'  notice  from  either  side  to  end  it.  This 
would  be  sufficient  time  to  carry  the  agreement  through  a 
season  and  give  opportunity  for  negotiation.  But  its  most 
important  features  for  the  future  of  industrial  democracy 
were  the  creation  of  three  new  institutions.  These  involved 
the  formation  of  joint  bodies  for  continuous  management. 
Of  the  first  two  of  these,  Cohen  says: 3 

For  the  purpose  of  securing  some  kind  of  law  and  order 
in  the  industry  two  institutions  were  created,  the  Board  of 
Arbitration  and  the  Board  of  Grievances.  It  is  but  fair  to 
say  that  those  who  devised  the  scheme  of  both  institutions 
had  nothing  more  definite  in  mind  than  the  acceptance 
frankly  of  the  probability  of  controversy  and  providing  some 
ready  machinery  to  meet  it  as  it  arose.  .  .  .  No  one  then 
believed  that  in  the  succeeding  four  and  one-half  years  the 
jurisdiction  of  the  Board  of  Arbitration  and  the  Board  of 
Grievances  would  be  exercised  in  something  like  16,000 
cases.  That  cases  would  arise  and  that  they  could  not  be 
rationally  settled  by  either  the  method  of  the  strike  or  the 
lockout  was  clear  in  the  minds  of  the  lawyers  who  framed 
the  Protocol.  The  i8th  paragraph  of  the  Protocol  provided : 

"The  parties  hereby  establish  a  Committee  on  Grievances, 
consisting  of  four  members  composed  as  follows :  two  to  be 
named  by  the  manufacturers  and  two  by  the  unions.  To 
said  committee  shall  be  submitted  all  minor  grievances  aris- 
ing in  connection  with  the  business  relations  between  the 
manufacturers  and  their  employees." 

It  will  be  observed  that  this  created  a  bi-partisan  board. 
Its  number  was  very  soon  increased  from  four  to  six  on 
each  side,  with  alternates.  Its  jurisdiction  was  not  outlined 

*J.  H.  Cohen,  Law  and  Order  in  Industry,  1916,  pp.  61,  62. 


UNIONS   AND  JOINT  MANAGEMENT  295 

in  detail.  Whether  it  was  to  be  in  the  nature  of  a  legis- 
lative body,  a  conciliation  body,  or  a  judicial  body  only 
subsequent  events  could  and  did  determine.  It  has  since 
become  all  three.  Obviously  the  simplest  cases  to  dispose 
of  were  those  in  which  an  employer  had  failed  to  observe 
the  definite  standards  established  by  the  Protocol.  He  had 
worked  overtime  when  work  was  prohibited,  or  he  had 
worked  illegally  on  a  holiday  or  a  Sunday,  or  he  had  paid 
less  than  the  scale.  Such  cases  presented  simple  questions 
of  fact.  It  is  one  of  the  striking  and  unique  experiences 
of  the  workings  of  this  Board  that  throughout  its  entire 
experience  there  never  was  a  deadlock  upon  a  question  of 
fact. 

Absence  of  Deadlock 

The  surprise  at  the  absence  of  a  deadlock  is  one  which 
is  shared  by  everyone  first  introduced  to  joint  management. 
Here  were  two  organizations  formed  for  fighting,  depending 
upon  their  hostility  as  a  means  of  mutual  existence.  They 
were  asked  to  work  together  immediately  after  a  bitter  fight 
and  to  deal  with  the  causes  of  that  fight.  Anyone  who  had 
been  called  upon  to  predict  the  probable  workings  of  such  a 
body  would  have  had  no  hesitation  in  prophesying  that  such 
a  board  would  be  a  continuous  Donnybrook  fair.  But  because 
it  was  asked  always  to  deal  with  facts  and  not  with  theories, 
it  never  had  a  deadlock.  Here  runneth  the  first  great  lesson 
of  industrial  democracy:  Have  a  means  of  determining,  test- 
ing, and  standardizing  facts,  and  both  sides  will  accept  the 
decisions  based  on  such  a  method.  People  do  not  quarrel 
about  the  multiplication  table. 

Influence  of  the  Protocol  on  Sanitation 

The  third  institution  which  was  created  by  the  protocol, 
and  which  proved  a  foundation-stone  of  a  new  industrial 
order,  was  the  joint  board  of  sanitary  control.  Like  the  other 
two  it  was  a  makeshift.  No  one  expected  much  of  it.  Yet 


296  PERSONNEL   RELATIONS   IN   INDUSTRY 

after  it  had  been  in  operation  for  a  few  years,  the  New  York 
Commissioner  of  Health  paid  it  this  tribute: 

The  effectiveness  of  its  work  has  been  universally  recog- 
nized and  commended,  and  the  program  of  the  Joint  Board 
is  today  the  program  of  the  Department  of  Health  for  the 
sanitary  regulation  of  industry  generally. 

Some  of  the  measures  that  grew  out  of  this  simple,  joint 
body,  with  no  more  real  powers  than  are  possessed  by  the 
safety  committee  of  any  factory  save  for  the  moral  support 
of  the  powerful  union  and  the  employers'  association  that 
stood  behind  it,  are  described  by  Cohen :  * 

This  institution  had  raised  the  sanitary  standards  of  the 
entire  city,  affecting  the  health  and  lives  of  not  less  than 
80,000  workers,  had  established  a  system  of  regular  fire 
drills,  a  system  of  careful  medical  examination  for  the 
workers  who  applied  for  it,  had  created  a  Sick-Death  Benefit 
Fund,  had  worked  out  measures  for  fire  protection,  first  aid 
to  the  injured,  had  studied  a  plan  for  insurance  against 
tuberculosis  and  other  infectious  diseases,  and  had  given  in- 
structions in  hygiene  to  the  workers  themselves. 

The  fact  that  all  this  was  accomplished  without  legisla- 
tion or  compulsion  is  especially  noteworthy.  Later,  many  of 
the  standards  thus  established  were  embodied  in  legislation 
designed  to  reach  other  industries.  For  its  success,  the  joint 
board  depended  upon  its  careful  examination  of  facts,  and 
the  authority  of  the  experts  whom  it  included  in  its  member- 
ship, to  prescribe  a  remedy;  and  then  upon  the  pressure  of 
public  opinion  and  joint  good-will,  to  secure  results. 

The  Preferential  Union  Shop 

One  more  institution  of  great  importance  in  the  establish- 
ment of  joint  management,  or  at  least  in  adjusting  joint  man- 

*J.  H.  Cohen,  Law  and  Order  in  Industry,  1916,  p.  52. 


UNIONS   AND  JOINT   MANAGEMENT  297 

agement  to  union  labor,  sprang  out  of  this  agreement.  It 
will  be  remembered  that  the  strike  started  over  the  question 
of  the  closed  shop.  By  the  time  the  other  questions  had  been 
settled  and  machinery  created  for  further  joint  action,  the 
question  of  the  closed  shop  had  lost  much  of  its  importance. 
Consequently  both  sides  were  willing  to  accept  a  compromise. 
This  compromise,  called  the  "preferential  union  shop,"  was 
destined  to  be  a  vital  point  in  many  subsequent  systems. 

As  the  name  indicates,  a  preferential  union  shop  is  one  in 
which  members  of  the  union  are  given  a  preference  but  non- 
unionists  are  not  excluded.  Where  sufficient  union  members 
apply  to  meet  the  need,  they  must  be  hired.  In  case  the  supply 
of  unionists  is  inadequate,  the  employer  is  permitted  to  hire 
non-unionists.  Persons  employed  previous  to  the  agreement 
are  not  compelled  to  join  the  union.  This  relieves  the  em- 
ployer of  the  always  disagreeable  duty  of  forcing  old 
employees  to  join  the  union,  under  threat  of  discharge.  It 
also  insures  the  union  of  sufficient  advantage  to  cause  its 
membership  to  grow  rapidly. 

The  Shop  Clerks 

In  1911  another  fight  developed  another  institution — the 
shop  clerks.  The  union  demanded  that  its  walking  delegates 
be  permitted  to  enter  and  inspect  a  shop  at  any  time.  This 
is  another  fundamental  demand  of  the  fighting  type  of  union. 
Without  such  inspection  the  union  is  unable  to  enforce  its 
contracts,  because  employees,  fearing  discharge,  will  not 
report  violations.  Like  the  demand  for  the  closed  shop,  the 
demand  for  inspection  is  particularly  obnoxious  to  employers, 
as  it  violates  their  instincts  of  self-respect,  leadership,  and 
assertiveness.  The  demand  of  the  union  for  the  enforcement 
of  its  contracts  is  an  effort  to  express  similar  instincts,  and 
has  therefore  naturally  been  a  constant  source  of  irritation 
in  labor  relations. 


298  PERSONNEL   RELATIONS   IN   INDUSTRY 

Under  the  protocol,  the  question  of  the  enforcement  of 
contracts  came  up  to  the  board  of  arbitration,  which  sug- 
gested that  each  side  appoint  a  deputy  or  clerk  in  each  shop, 
to  be  chosen  from  their  regular  employees.  The  employees 
were  immediately  to  investigate  any  complaint,  and  if  pos- 
sible, secure  an  adjustment.  They  were  not,  however,  to 
argue  at  any  length  over  matters.  If  anyone  wished  he  could 
at  once  insist  upon  an  appeal  to  the  board  of  grievances. 

Previous  experience  with  shop  difficulties  led  to  a  general 
belief  that  these  officials  would  almost  invariably  disagree  and 
call  for  an  appeal.  An  investigation  by  the  United  States 
Department  of  Labor  brought  out  the  fact  that:5 

Out  of  a  total  of  7,656  complaints  filed  between  April 
15,  1911,  the  date  of  the  creation  of  the  Board  of  Grievances, 
and  October  31,  1913,  7,477,  or  97.7  per  cent,  were  adjusted 
by  the  clerks.  The  balance,  179,  or  2.3  per  cent,  were 
handled  by  the  Board  of  Grievances.  Of  the  latter  group 
159  were  settled  by  the  Board.  The  remaining  20,  the  Board 
being  unable  to  agree,  were  referred  to  the  Board  of  Arbitra- 
tion for  final  adjudication.  Of  these  20  cases,  12  involved 
the  same  disputed  point — a  controversy  over  the  interpreta- 
tion of  the  Protocol  as  to  the  payment  for  a  holiday.  As 
this  involved  a  question  of  interpretation  which  could  be 
passed  upon  finally  only  by  the  Board  of  Arbitration,  it 
left  but  nine  actually  deadlocked  cases.  In  other  words, 
one-tenth  of  i  per  cent  of  all  the  cases  that  arose  during 
the  existence  of  the  Protocol  up  to  that  time  were  dead- 
locked in  the  Board  of  Grievances.  Of  these  nine  cases, 
the  investigation  showed  they  were  cases  involving  serious 
and  fundamental  differences. 

The  findings  of  this  investigation  establish  that,  upon  the 
whole,  the  system  devised  in  1911  worked  satisfactorily  in 
99  per  cent  of  the  cases;  yet  because  of  the  i  per  cent 
it  broke  down  partially  in  1913  and  completely  in  1915. 
Why? 

•J.  H.  Cohen,  Law  and  Order  in  Industry,  1916,  p.  72. 


UNIONS  AND  JOINT  MANAGEMENT  299 

Evolution  of  Industrial  Democracy  through  the  Protocol 

Before  answering  this  "Why?"  there  are  a  few  appro- 
priate general  observations  that  should  be  made  upon  the 
working  of  the  protocol  and  the  foundations  it  laid  for  joint 
management 

The  protocol  had  begun  to  modify  the  fighting  form  of 
the  organizations  of  both  employees  and  employers.  It  was 
changing  their  character  as  fighting  bodies — beginning  to  dis- 
arm in  preparation  for  co-operating.  The  demand  for  the 
closed  shop  had  become  less  imperative.  The  walking  delegate 
had  disappeared.  John  R.  Commons  holds  that  this  was  a 
natural  and  inevitable  development  of  joint  management.  He 
says:  ° 

This  is  not  saying  that  national  associations,  either  of 
employers  or  unions,  have  no  place  in  the  awakening  new 
spirit  of  collective  action.  They  have  a  place,  but  it  is 
different.  Their  new  place  is  more  professional  and  educa- 
tional and  less  executive  and  governmental.  It  is  the  place 
for  comparing  notes  and  statistics,  sharing  experiences,  tell- 
ing each  other  of  their  successes  and  showing  how  it  is 
done  in  dealing  with  labor.  It  is  less  and  less  the  place 
for  depriving  the  employer  of  his  freedom  to  deal  with  his 
own  employees  in  his  own  shop.  Employers'  associations 
will  and  must  expand,  but  they  should  become  great  educa- 
tional conferences  on  the  methods,  the  purpose  and  the 
spirit  of  shop  organization,  rather  than  law-making  bodies 
for  their  members. 

The  spirit  of  democracy  will  not  be  confined  to  joint 
actiop.  It  will  travel  back  to  the  organizations  of  labor  and 
employers  and  democratize  them  and  fit  them  for  constructive 
co-operation. 

To  return  to  the  evolution  of  industrial  democracy  through 
the  protocol.  It  was  never  intended  as  a  means  of  abolishing 

fj-  R-  Commons,  Industrial  Goodwill,  1919,  pp.  113-116. 


3°0      PERSONNEL  RELATIONS  IN  INDUSTRY 

the  antagonistic  interests  of  employer  and  employee.  Neither 
did  those  who  established  and  operated  it  seek  to  conjure  those 
antagonistic  interests  away  by  closing  their  eyes  to  their  exist- 
ence. Cohen's  statement  on  this  point  deserves  careful  study. 
He  says: 7 

This,  then,  was  the  policy  of  the  Protocol:  Assuming 
controversy  and  conflict  between  parties  having  divergent 
interests  as  inevitable,  that  such  controversy  should  be  put 
upon  the  plane  of  procedure  of  civilized  and  orderly  men; 
that  justice,  however  approximate,  should  be  arrived  at  by 
the  rational  method,  and  that  law  and  order  should  take 
the  place  of  anarchy. 

There  is  an  important  warning  here  to  those  enthusiasts 
who  substitute  inspiration  for  intelligence  in  dealing  with 
labor  relations,  and  who  seek  to  force  harmony  and  brother- 
hood before  divergent  or  antagonistic  interests  are  adjusted. 
Several  antagonistic  forces — inertia,  expanding  steam,  fric- 
tion, gravitation — are  present  in  nearly  every  machine.  The 
engineer  who  would  seek  to  construct  or  operate  a  machine 
on  the  theory  that  all  these  forces  work  in  harmony  to  the 
same  end,  would  have  a  strange  and  foolish  mechanism.  But 
by  recognizing  and  allowing  for  them  all,  and  using  those 
available,  a  multitude  of  fairly  efficient  machines  have  been 
evolved. 

Cause  of  Collapse  of  Protocol 

Even  the  final  collapse  of  the  protocol  carried  its  lessons 
and  helped  to  found  a  better  organization.  Unless  the  story 
of  the  growth  of  human  institutions  is  suddenly  to  take  a 
new  course,  there  will  be  many  such  failures  in  the  future, 
and  if  these  failures  are  studied,  they  can  be  made  to  con- 


f  J.  H.  Cohen,  Law  and  Order  in  Industry,  1916,  p.  42. 


UNIONS  AND  JOINT  MANAGEMENT  3O1 

tribute  as  much  to  the  growth  of  democratic  institutions  as 
some  of  the  successes. 

The  particular  cause  of  the  collapse  was  a  demand  of  the 
union  that  no  workers  should  be  discharged  during  the  dull 
season.  This  sounds  like  an  unreasonable  demand,  and  it  was 
unreasonable.  Yet  it  grew  naturally  out  of  the  form  of  the 
agreement,  the  necessities  of  the  union,  and  the  nature  of 
the  trade.  The  agreement  provided  that  any  employee  who 
had  worked  for  more  than  two  weeks  could  not  be  discharged 
without  the  right  of  appeal  to  the  board  of  grievances.  Both 
sides  intended  this  rule  only  to  prevent  some  immediate  injus- 
tice in  discharge;  there  was  no  thought  of  stabilizing  seasonal 
employment.  But  the  moment  order  was  introduced  into  the 
industry  the  union  was  confronted  by  the  fact  that  if,  during 
seasonal  fluctuations,  a  portion  of  its  members  were  selected 
for  steady  work,  the  others  would  not  only  lose  interest  in 
the  union,  but  would  view  the  process  of  selection  with  sus- 
picion. This  would  inevitably  lead  to  dissension  and  conflict 
within  the  union. 

The  attorney  for  the  union,  in  presenting  his  case  to  the 
board  of  arbitration,  set  forth  the  position  of  the  union  as 
follows: 8 

In  regard  to  retaining  men,  we  absolutely  militate  against 
the  principle  of  recognizing  merit  as  a  ground  for  retention, 
as  a  ground  for  preference  over  the  man  that  is  less  skilled, 
and  we  say  this,  that  this  is  the  principle  upon  which  our 
organization  rests,  and  with  which  it  will  have  to  stand 
or  fall,  and  that  is  the  principle  that  the  organization  is 
not  here  to  allow  the  so-called  free  play  of  nature  or  com- 
petitive forces,  which  will  pick  out  20,000  men  out  of 
50,000  men,  or  women  for  that  matter,  and  secure  them 
constant,  permanent  and  lucrative  employment  and  leave  the 
30,000  other  men  and  women  to  smaller  remuneration  during 

*J.  H.  Cohen,  Law  and  Order  in  Industry,  1916,  p.  144. 


302  PERSONNEL   RELATIONS   IN   INDUSTRY 

seasons,  and  to  no  earnings  of  any  kind,  and  starvation,  after 
season. 

The  permanency  and  institutional  character  of  the  protocol 
had  created  a  status  for  employees  which  the  union  insisted 
must  be  maintained.  The  attorney  for  the  union  said,  "The 
union  is  here  to  stand  for  all  its  members;  by  this  we  stand 
or  fall."  He  could  not  take  any  other  position  and  retain 
the  confidence  of  the  union  membership.  By  adjusting  one 
set  of  difficulties,  the  protocol  had  but  lifted  the  lid  that 
concealed  deeper  and  more  fundamental  issues.  This  is  a  way 
that  growing  democracy  has — it  grows  only  by  meeting  each 
emergency  as  it  arises. 

The  employers  rightly  declared  that  to  grant  such  a 
demand  for  a  status  of  employees  destroyed  all  discipline  and 
rendered  efficiency  impossible.  Here  was  a  clear  conflict  be- 
tween the  interests  of  the  human  element  and  the  interests  of 
efficiency. 

The  Strike  of  1915 

The  board  of  grievances,  and  board  of  arbitration,  not 
having  been  formed  to  meet  any  such  situation,  naturally 
refused  to  consider  discharge  for  lack  of  work  a  grievance 
within  their  jurisdiction.  The  industry  was  at  once  plunged 
into  the  bitter  strike  of  1915.  The  union  had  a  full  treasury, 
a  confident,  belligerent,  and  efficient  membership  united  upon 
this  one,  to  it,  vital  demand.  There  seemed  no  way  out. 
Mayor  Mitchel  was  asked  to  appoint  a  committee  to  try  to 
adjust  the  difficulty.  This  committee  consisted  of  Felix  Adler, 
president  of  the  Ethical  Society;  Walter  C.  Noyes,  ex-judge 
of  the  United  States  Court  of  Appeals ;  George  W.  Kirchwey, 
ex-dean  of  Columbia  Law  School;  Henry  Bruere,  city  cham- 
berlain; Louis  D.  Brandeis,  ex-head  of  the  Board  of  Arbitra- 
tion; and  Charles  L.  Bernheimer,  chairman  of  the  Committee 


UNIONS   AND  JOINT   MANAGEMENT  3°3 

on  Arbitration  of  the  Chamber  of  Commerce.  The  committee 
listened  to  the  statements  and  arguments  of  both  sides  for  a 
considerable  period.  Then  it  issued  the  following  decision: ' 

Fundamental  Principles  of  Joint  Management 

....  The  principle  of  industrial  efficiency  and  that  of 
respect  for  the  essential  human  rights  of  the  workers  should 
always  be  applied  jointly,  priority  being  assigned  to  neither. 
Industrial  efficiency  may  not  be  sacrificed  to  the  interests 
of  the  workers,  for  how  can  it  be  to  their  interest  to  destroy 
the  business  on  which  they  depend  for  a  living,  nor  efficiency 
be  declared  paramount  to  the  human  rights  of  the  workers; 
for  how  in  the  long  run  can  the  industrial  efficiency  of  a 
country  be  maintained  if  the  human  values  of  its  workers 
are  diminished  or  destroyed?  The  delicate  adjustment 
required  to  reconcile  the  two  principles  must  be  made.  Peace 
and  progress  depend  upon  complete  loyalty  to  the  effort  to 
reconcile  them. 

In  accordance  with  this  fundamental  principle  the  follow- 
lowing  decision  was  made  concerning  the  right  of  the  employer 
to  hire  and  discharge.10 

i.  Under  the  present  competitive  system,  the  principle 
of  industrial  efficiency  requires  that  the  employer  shall  be 
free  and  unhampered  in  the  performance  of  the  administra- 
tive functions  which  belong  to  him,  and  this  must  be  taken 
to  include: 

a.  That  he  is  entirely  free  to  select  his  employees  at  his 
discretion. 

b.  That  he  is  free  to  discharge  the  incompetent,  the  in- 
subordinate, the  inefficient,  those  unsuited  to  the  shop  and 
those  unfaithful  to  their  obligations. 

c.  That  he  is  free  in  good  faith  to  reorganize  his  shop 
whenever  in  his  judgment   the  conditions  of  the  business 
should  make  it  necessary  for  him  to  do  so. 

*J.  H.  Cohen,  Law  and  Order  in  Industry,  1916,  p.  172. 
"Ibid.,  pp.  172,  173. 


3°4  PERSONNEL   RELATIONS   IN   INDUSTRY 

d.  That  he  is  free  to  assign  work  requiring  a  superior 
or  special  kind  of  skill  to  those  employees  who  possess  the 
requisite  skill. 

e.  That  while  it  is  the  dictate  of  common  sense  as  well 
as  common  humanity,  in  the  slack  season  to  distribute  work 
as  far  as  possible  equally  among  wage-earners  of  the  same 
level  and  character  of  skill,   this  practice  cannot  be  held 
to  imply  the  right  to  a  permanent  tenure  of  employment, 
either  in  a  given  shop  or  even  in  the  industry  as  a  whole. 
A  clear  distinction  must  be  drawn  between  an  ideal  aim  and 
a  present  right. 

Here  is  apparently  a  complete  rejection  of  the  demands 
of  the  union.  As  the  union  was  still  in  excellent  fighting 
condition,  the  observer  would  naturally  expect  the  decision 
to  be  rejected  and  the  strike  to  proceed  with  increased  bitter- 
ness. On  the  contrary,  the  decision  was  at  once  accepted  by 
the  union,  as  applied  to  the  cloak  situation  in  New  York,  and 
a  few  months  later  was  made  the  basis  of  similar  agreements 
in  Boston  and  Chicago.  The  comment  of  Cohen  on  this  out- 
come may  well  serve  as  a  concluding  comment  on  the  prin- 
ciples which  the  experience  of  the  protocol  showed  to  be 
fundamental  in  establishing  institutions  for  joint  manage- 
ment: 1X 

The  final  result,  so  valuable  to  all  parties  concerned, 
could  not  have  been  accomplished  by  mutual  agreement.  It 
required  judgment,  impartial  judgment,  by  a  tribunal  in 
which  both  sides  had  confidence  and  before  which  each  side 
might  have  a  full  and  complete  hearing.  Before  such  a 
tribunal  there  could  be  battle,  not  the  battle  of  war,  but 
of  ideas.  The  prime  lesson  of  the  1915  experience  is  that 
great  conflict  over  vital  principles  will  arise  even  under 
joint  agreements.  Such  conflicts  cannot  be  settled  by  force. 
Neither  the  strike  nor  the  lockout  will  help.  They  cannot 
be  settled  by  courts  of  law;  courts  of  law  are  not  constituted 


UJ.  H.  Cohen,  Law  and  Order  in  Industry,  1916,  p.  176.     Italics  in 
original. 


UNIONS   AND  JOINT   MANAGEMENT  3°5 

to  take  care  of  them.  They  cannot  be  settled — indeed  should 
not  be  settled — by  compromise.  They  must  be  beaten  out  in 
a  forum  of  reason.  If  such  a  forum  does  not  exist  it  must 
be  created.  And  even  though  it  exist,  errors  of  judgment, 
like  errors  of  courts,  must  be  expected.  Such  errors  will 
require  correction,  modification,  or  even  reversal.  Through 
error  progress  will  be  made. 

Educational  Value  of  Protocol 

The  protocol  had  made  its  great  contributions  to  the 
evolution  of  the  institutions  of  joint  management.  It  had 
evolved  instruments  for  the  adjustment  of  grievances,  the 
arbitration  of  differences,  and  the  determination  of  principles. 
It  had  begun  the  process  of  mutual  disarmament,  and  the 
transformation  of  the  organizations  of  labor  and  employers 
from  armed  forces  into  constructive  social  institutions.  It 
had  educated  thousands  of  employees  and  employers  to  cer- 
tain very  important  fundamental  principles  of  industrial 
democracy. 

Having  made  these  important  contributions,  as  so  often 
happens  in  the  development  of  social  institutions,  this  par- 
ticular group  momentarily  surrendered  the  lead.  Internal  dis- 
sensions, a  belief  of  each  side  that  more  could  be  gained  by 
an  open  fight,  aggravated  by  some  peculiar  personal  develop- 
ments, led  to  the  abandonment  of  the  whole  plan  and  a  series 
of  struggles  between  the  union  and  the  employers.  Anyone 
who  has  watched  the  evolution  of  national  and  international 
relations  will  find  it  easy  to  parallel  this  situation  many  times. 
But  this  does  not  prove  that  orderly  government  is  not  de- 
sirable or  even  that  better  international  relations  cannot  be 
established. 

The  Hart,  Schaffner  and  Marx  Trade  Board  Plan 

The  line  of  evolution  passed  next  to  another  branch  of 
the  garment  trade.  The  great  strike  of  1910  extended  to 


306  PERSONNEL   RELATIONS    IN   INDUSTRY 

Chicago.  In  seeking  a  settlement,  the  firm  of  Hart,  Schaffner 
and  Marx,  in  co-operation  with  their  employees,  established 
a  method  of  maintaining  relations  that  in  1916  grew  into 
an  agreement  that  has  since  become  the  most  promising  ex- 
pression of  industrial  democracy  to  be  found  in  the  United 
States. 

This  agreement  of  1916  provided  for  a  board  of  arbitra- 
tion and  a  trade  board,  with  deputies  and  other  joint  officials. 
The  board  of  arbitration  was  the  court  of  final  jurisdiction 
over  all  matters  contained  in  the  joint  agreement,  which  pro- 
vided that : 12 

It  shall  be  the  duty  of  the  Board  to  investigate  and  to 
mediate  or  adjudicate  all  matters  that  are  brought  before 
it  and  to  do  all  in  its  power  to  insure  the  successful  working 
of  the  agreement.  In  reaching  its  decisions  the  Board  is 
expected  to  have  regard  to  the  general  principles  of  the 
agreement;  the  spirit  and  intent,  expressed  or  implied,  of 
the  parties  thereto;  and,  especially,  the  necessity  of  making 
the  instrument  workable,  and  adaptable  to  varying  needs  and 
conditions,  while  conserving  as  fully  as  possible  the  essential 
interests  of  the  parties  involved. 


If  there  shall  be  a  general  change  in  wages  in  the  cloth- 
ing industry,  which  shall  be  sufficiently  permanent  to  war- 
rant the  belief  that  the  change  is  not  temporary,  then  the 
Board  shall  have  power  to  determine  whether  such  a  change 
is  of  so  extraordinary  a  nature  as  to  justify  a  consideration 
of  the  question  of  making  a  change  in  the  present  agree- 
ment, and,  if  so,  then  the  Board  shall  have  power  to  make 
such  changes  in  wages  or  hours  as  in  its  judgment  shall  be 
proper. 

In  place  of  the  board  of  grievances  of  the  protocol,  the 

"  The  Hart,  Schaffner  and  Marx  Labor  Agreement,  1920,  p.  12.  This 
is  a  compilation  of  original  documents  and  special  articles  on  the  history 
and  operation  of  the  plan,  and  is  the  most  important  source  of  informa- 
tion. 


UNIONS   AND  JOINT   MANAGEMENT  3<>7 

Hart,  Schaffner  and  Marx  plan  established  a  trade  board,  the 
qualifications  and  powers  of  which  are  defined  as  follows : 13 

The  Trade  Board  is  the  primary  board  for  adjusting 
grievances,  and  shall  have  original  jurisdiction  over  all 
matters  arising  under  this  agreement  and  the  decisions 
relating  thereto,  and  shall  consider  and  dispose  of  all  matters 
when  regularly  brought  before  it,  subject  to  such  rules  of 
practice  and  procedure  as  are  now  or  may  be  hereafter 
established. 

The  Board  shall  consist  of  eleven  members,  all  of  whom 
excepting  the  chairman,  shall  be  employees  of  Hart,  Schaff- 
ner &  Marx.  Five  members  shall  be  chosen  by  the  company, 
and  five  by  the  union,  and  it  is  understood  that  these  shall 
be  selected  in  such  manner  as  to  be  representative  of  the 
various  departments — cutting  and  trimming,  coat,  vest  and 
trousers. 

The  Board  shall  be  presided  over  by  a  chairman  who 
shall  represent  the  mutual  interest  of  both  parties  hereto, 
and  especially  the  interest  of  the  successful  working  of  this 
agreement. 

This  "impartial  chairman"  is  an  integral  and  important 
part  of  the  plan,  and  is  one  of  the  fundamental  contributions 
of  this  agreement  to  the  development  of  joint  management. 
So  complete  is  the  confidence  and  power  vested  in  him,  that 
the  other  members  of  the  board  no  longer  attend  meetings. 
Such  chairmen,  both  of  the  trade  board  and  board  of  arbitra- 
tion, are  agreed  upon  at  the  time  of  the  formation  of  the 
original  agreement.  In  the  case  of  the  three  members  of 
the  board  of  arbitration,  the  names  of  all  are  decided  upon 
at  the  beginning.  Either  party  may  remove  the  particular 
member  whom  it  appoints  to  the  board  of  arbitration.  But 
the  chairman  is  not  removable  except  by  joint  negotiations. 

The  industry  has  been  extremely  successful  in  securing 

"The  Hart,  Schaffner  and  Marx  Labor  Agreement,  1920,  p.  12. 


308  PERSONNEL   RELATIONS   IN   INDUSTRY 

men  of  marked  ability  and  integrity,  in  whom  both  sides  have 
had  confidence.  Furthermore,  since  the  power  to  enforce 
decisions  must  rest,  in  the  last  analysis,  upon  continued  joint 
good-will,  there  is  an  automatic  safeguard  against  even  uncon- 
scious unfairness. 

In  1916  the  agreement  was  subjected  to  its  most  important 
crisis.  The  union  insisted  that  "a  general  change  in  wages 
in  the  clothing  industry  .  .  .  sufficiently  permanent  to  war- 
rant the  belief  that  the  change  is  not  temporary"  had  taken 
place,  and  that  therefore  the  board  of  arbitration  must  be 
called  upon  to  formulate  a  new  scale.  This  was  disputed 
by  the  employers ;  but  the  matter  was  finally  left  to  the  board 
of  arbitration,  which  decided  that  such  a  change,  within  the 
meaning  of  the  above  clause,  existed.  Consequently  a  new 
scale  was  drawn  up  and  accepted  by  both  sides. 

National  Extension  of  Plan 

Three  years  later,  in  July,  1919,  the  plan  was  extended 
to  the  entire  clothing  trade.  The  National  Industrial  Federa- 
tion of  Clothing  Manufacturers  was  formed,  with  a  board 
of  governors  consisting  of  four  manufacturers  with  alternates. 
These  represented  the  four  great  centers  of  the  clothing  indus- 
try— Chicago,  New  York,  Rochester,  and  Baltimore.  The 
articles  of  federation  also  provided  that  "Markets  not  at 
present  represented  in  the  Federation  may  be  admitted  on 
application  to  the  Board  of  Governors." 

Further  important  provisions  read  as  follows: 

The  Board  of  Governors,  by  a  unanimous  vote  of  the  full 
Board,  shall  have  authority  on  behalf  of  the  participating 
manufacturers  to  establish  lawful  rules  and  regulations  with 
reference  to  the  industrial  relations  between  the  employer 
and  employees,  and  to  negotiate  and  formulate  lawful 
agreements  with  the  Amalgamated  Clothing  Workers  of 
America,  or  any  other  association  of  employees.  The  Board 


UNIONS   AND  JOINT   MANAGEMENT  3°9 

of  Governors  shall  also  have  authority  to  establish  an  organ- 
ization with  proper  administrative  functions  for  the  purpose 
of  stabilizing  standards  of  efficiency  and  conditions  of 
employment  in  the  industry. 

The  Board  of  Governors  shall  immediately  establish  a 
National  Board  of  Labor  Managers  as  one  of  its  administra- 
tive agencies  to  which  it  may  delegate  authority  to  execute 
policies  and  policies  adopted.  Each  district  shall  nominate 
a  labor  manager  who,  when  approved  by  the  Board  of 
Governors,  shall  become  one  of  the  four  members  of  the 
National  Board  of  Labor  Managers.  The  Board  of  Labor 
Managers  shall  have  a  chairman  responsible  for  the  func- 
tioning of  the  board. 

George  L.  Bell,  New  York  chairman  of  Industrial  Rela- 
tions Committee,  explains  some  further  and  interesting  func- 
tions of  this  national  organization:  14 

The  formal  creation  of  a  national  joint  council  with  full 
powers  and  representing  equally  the  manufacturers  and  the 
organized  workers  has  been  completed.  It  is  the  plan  of 
those  interested  to  make  the  council  a  vital  and  living  thing 
by  having  a  full  time  secretariat  and  research  bureau  con- 
stantly at  work  on  the  problems  of  industrial  relations,  un- 
employment, production,  elimination  of  seasonal  aspects  of 
the  industry  and  other  similar  questions.  With  such  a 
research  bureau  constantly  functioning,  the  council  should 
develop  into  a  real  and  creative  institution.  Without  such 
a  bureau  there  is  danger  of  degeneration  into  an  informal 
organization  meeting  at  infrequent  intervals  and  without 
facts,  authority  and  information  gathered  to  serve  as  a  basis 
for  decision. 

Another  development  made  possible  by  the  creation  of  a 
national  organization  is  the  interchange  of  decisions  between 
the  various  trade  boards  and  boards  of  arbitration.  These 
decisions  are  now  indexed  according  to  the  standard  system 

14  G.  L.  Bell,  To  Meet  the  Changing  Problems,  Survey,  Sept.  13,  1919. 


310  PERSONNEL   RELATIONS    IN   INDUSTRY 

used  with  legal  decisions  and  point  to  the  establishment  of 
a  "common  law  in  industry."  Of  this  development,  Dean 
John  H.  Wigmore,  of  the  Northwestern  School  of  Law, 
'.says:  15 

The  Labor  Manager 

The  significant  thing  is  that  general  principles  are  be- 
ginning to  be  formulated.  And  the  moment  you  have  general 
principles,  used  for  deciding  particular  cases,  you  have  jus- 
tice in  the  form  of  law,  as  distinguished  from  the  arbitrary 
justice  of  a  Turkish  Caliph,  or  from  private  struggle  decided 
by  private  force. 

Before  these  various  tribunals  each  side  is  now  repre- 
sented by  its  specially  trained  representative.  He  acts  as  an 
attorney  for  his  side.  He  must  be  an  expert  in  industrial 
relations.  This  need  has  developed  on  the  side  of  the  em- 
ployers another  essential  institution,  the  skilled  labor  manager. 
These  labor  managers  meet  regularly  for  joint  discussion  and 
decisions  as  to  policy.  Hart,  Schaffner  and  Marx  say  of  their 
labor  department  and  the  manager  who  heads  it:  ie 

This  new  department,  headed  by  Professor  Earl  Dean 
Howard  of  Northwestern  University,  gradually  assumed 
certain  functions  in  which  the  workers  had  a  direct  interest 
and  administered  them  with  the  main  purpose  always  in 
view.  The  chief  duties  of  the  labor  department  now  are:  the 
maintenance  of  a  system  for  the  prompt  discovery  and 
investigation  of  any  abuses  or  complaints  existing  anywhere 
among  the  employees;  the  recommendation  of  measures 
designed  to  eliminate  the  source  of  complaint;  protecting 
the  company's  interests  in  the  Board  of  Arbitration  and  the 
Trade  Board;  negotiating  with  the  business  agents  of  the 
unions  and  satisfying  their  demands  as  far  as  possible; 
administering  all  discipline  for  all  the  factories  (all  execu- 

"  Illinois  Law  Review,  Mar.  1916. 

'*  The  Hart,  Schaffner  and  Marx  Labor  Agreement,  1920,  p.  65. 


UNIONS   AND  JOINT  MANAGEMENT  311 

tives  have  been  relieved  of  this  function) ;  general  oversight 
of  all  hiring;  the  maintenance  of  hospital  and  rest  rooms; 
the  administration  of  a  charity  fund  for  unfortunate  em- 
ployees, of  a  loan  fund,  and  of  the  Workmen's  Compensation 
Act;  responsibility  for  the  observance  of  the  state  and 
municipal  laws  regarding  child  labor,  health  and  safety,  also 
for  the  strict  observance  of  all  agreements  with  the  unions 
or  decisions  of  the  two  Boards;  education  of  the  foremen 
and  people  in  courtesy,  patience,  mutual  helpfulness  and 
other  peace-producing  qualities ;  suggesting  devices  for  the 
amelioration  of  hardships  incidental  to  the  industry  and  for 
the  higher  efficiency  of  operating. 

The  high-grade  employment  practice  which  is  insured 
through  the  work  of  employment  managers  of  this  kind,  nearly 
all  of  whom  are  university-trained  men  and  several  of  whom 
are  of  national  prominence  as  authorities  upon  labor  prob- 
lems, is  of  the  utmost  importance  to  the  success  of  any  such 
plan.  Such  men  bring  expert  opinion  to  bear  upon  every 
question,  and  their  employment  guarantees  that  facts  will  be 
scientifically  collected  and  presented  and  that  a  constantly  in- 
creasing body  of  such  facts  will  be  built  as  a  basis  of  all 
actions. 

Success  of  Trade  Board  Plan 

The  greatest  achievement  of  the  trade  board  plan  is  per- 
haps to  be  found,  not  in  the  fact  that  strikes  have  been 
avoided,  although  this  naturally  attracts  the  most  attention 
and  is  a  great  gain,  but  in  the  fact  that  the  work  has  been 
thoroughly  standardized  for  the  settlement  of  future  prob- 
lems. Professor  Howard  says  on  this  point:  " 

Lack  of  standards  is  probably  the  chief  cause  of  disorder 
and  conflicts,  especially  in  the  needle  industries.  This  in- 
cludes standards  of  workmanship,  piece-work  prices,  conduct 


"  The  Hart,  Schaffner  and  Marx  Labor  Agreement,  1920,  p.  75. 


312  PERSONNEL   RELATIONS   IN   INDUSTRY 

in  the  shop,  and  all  points  which  involve  the  interest  of  the 
employee. 

The  primary  tribunals  or  Trade  Board  should  settle 
finally  all  disputes  as  to  facts;  appeals  should  be  taken  only 
when  disputed  standards  are  involved.  Each  case  before  the 
Board  of  Arbitration  is  an  opportunity  to  establish  one  or 
more  standards.  Thus,  unless  the  industry  is  one  of  great 
changes,  the  board  will  find  the  need  for  its  services  grow 
gradually  less  as  both  parties  learn  to  be  governed  by 
standards.  The  immense  value  to  an  industry  of  established 
standards  should  reconcile  the  parties  to  the  time  consumed 
in  deciding  some  comparatively  unimportant  case  which  hap- 
pens to  afford  an  opportunity  for  creating  a  standard.  The 
board  in  such  cases  should  get  expert  and  technical  testi- 
mony from  all  sources  through  witnesses  and  committees  of 
investigation,  so  that  the  work  is  done  once  for  all. 

Effect  of  Joint  Management  on  Production 

This  movement  also  meets  the  vital  test  of  any  form  of 
industrial  organization  in  that  it  has  improved  production. 
The  time  is  still  too  short  for  any  accurate  general  statement. 
Sidney  Hillman,  president  of  the  Amalgamated  Garment 
Workers'  Union,  to  whose  able  leadership  much  of  the  success 
attained  is  due,  stated  in  an  address  before  the  National  Indus- 
trial Relations  Convention  at  Chicago,  in  June,  1920,  that 
this  industry  was  the  only  one  that  had  shown  an  actual 
increase  in  production  per  worker  during  the  year  previous. 
George  L.  Bell,  previously  quoted,  holds  that  only  through 
some  such  phase  of  industrial  democracy  is  it  possible  to 
secure  that  co-operation  of  the  workers  which  is  essential  to 
increased  production.  Jacob  M.  Moses,  impartial  chairman 
of  the  Baltimore  trade,  is  more  specific,  when  he  says:  18 

Before  the  agreements  were  made  with  the  union  the 
employers  found  it  next  to  impossible  to  improve  their 

"Annals  of  the  American  Academy,  Sept.  1919,  p.  174. 


UNIONS   AND  JOINT   MANAGEMENT  3J3 

methods  of  production  and  the  installation  of  new  systems 
was  almost  out  of  the  question.  The  workers  resisted 
changes  which  involved  learning  a  new  operation  or  a  loss 
in  wages.  After  all,  when  a  man  has  been  making  pockets 
in  a  certain  way  for  ten  years  and  has  acquired  great  skill 
and  speed  and  a  fair  earning  capacity,  he  can  hardly  be 
expected  to  submit  tamely  to  a  radical  change  in  method 
which  practically  nullifies  his  accomplishment  and  relegates 
him  to  the  rank  of  a  learner  or  the  unskilled  worker.  There- 
fore, every  important  change  usually  involved  a  stoppage  of 
work  and  the  employer  considered  himself  fortunate  if  he 
could  secure  a  slight  concession.  This  situation  is  dealt  with 
in  the  agreement  (clause  H)  which  provides  that  changes 
in  methods  of  production,  as  well  as  changes  of  workers 
from  one  operation  or  department  to  another,  may  be  made 
by  the  employer,  provided  the  individual  worker  does  not 
suffer  because  of  such  change.  Of  course  the  shop  chairman 
must  be  notified  before  such  change  is  made,  so  that  he  may 
explain  the  matter  to  the  worker  or  group  and  assure  them 
that  they  will  not  be  permitted  to  suffer  through  the  change. 
This  means,  especially,  that  the  workers  will  not  receive  less 
wages  under  the  changed  conditions.  This  clause  of  the 
agreement  has  been  construed  by  the  Trade  Board  to  permit 
the  introduction  of  new  machinery,  new  systems  of  handling 
and  routing  the  work,  new  methods  of  production,  the  keep- 
ing of  records  by  the  workers  and,  within  the  last  few 
months,  the  taking  of  time-studies  for  the  purpose  of  estab- 
lishing piece  rates  and  standards  of  production.  Obviously, 
this  is  a  tremendous  gain,  and  although,  at  times,  such  inno- 
vations have  met  with  vigorous  protest  from  the  rank  and 
file,  yet  the  leaders  of  the  union,  all  things  considered,  have 
displayed  a  spirit  of  cooperation  and  a  degree  of  intelligence 
and  comprehension  of  modern  business  methods  truly 
remarkable. 

This  changed  attitude  of  the  organized  worker  toward 
time  and  motion  study  is  perhaps  the  most  remarkable  testi- 
mony, both  to  the  increased  interest  in  production,  and  to  the 
general  altered  character  of  previous  fighting  organizations. 


3^4  PERSONNEL   RELATIONS   IN   INDUSTRY 

The  mere  proposal  to  use  these  methods  would  have  brought 
a  strike  in  the  old  days.  John  R.  Commons  describes  present 
methods  as  follows : 19 

The  two  representatives  on  the  Trade  Board  constitute 
themselves  a  committee  of  time-and-motion  study  experts  in 
order  to  fix  the  prices  of  work.  These  work  together  with 
their  stop-watch,  if  needed,  to  ascertain  and  agree  upon  the 
time  required  to  make  the  new  piece,  and  to  calculate  the 
corresponding  piece  rate. 

....  And  the  workers  are  just  as  much  concerned  as 
the  management  to  have  the  speeds  accurate.  For  their 
wages  and  speed  depend  upon  it.  Where  opinions  differ 
there  can  be  no  accuracy,  in  the  mechanical  sense,  but  there 
may  be  conciliation  and  a  working  agreement. 

Interest  of  Union  in  Efficiency 

The  most  remarkable  expression  of  this  attitude  is  to  be 
found  in  an  incident  in  Cleveland.  Here  the  International 
Ladies'  Garment  Workers,  the  same  organization  that,  in 
New  York,  had  built  up  and  then  withdrawn  from  the  pro- 
tocol, has  been  feeling  its  way  back  toward  joint  management 
of  the  newer  form.  A  recent  observer  describes  the  develop- 
ments that  have  taken  place  there : 20 

Frankly  casting  aside  their  old  hatred  of  "efficiency,"  the 
six  Cleveland  locals  of  the  International  Ladies'  Garment 
Workers'  Union  have  assumed  half,  or  $10,000,  of  the  ex- 
penses of  a  study  of  the  industry  in  Cleveland  by  a  New 
York  firm  of  industrial  engineers.  The  engineers  are  in- 
structed to  rearrange  the  wage  scale  on  the  basis  of  a  pro- 
tected minimum  yearly  income,  to  introduce  economical 
methods  of  operation  in  place  of  traditional  wastes  and  to 
devise  a  plan  for  joint  managerial  and  union  control  of  pro- 
duction. 

"J.  R.  Commons,  Industrial  Goodwill,  1919,  p.  124. 
"J.  W.  Love,  Teamwork  in  the  Cleveland  Garment  Industry,  Survey, 
Apr.  3,  1920,  pp.  24,  25. 


UNIONS   AND  JOINT   MANAGEMENT  3X5 

The  other  half  of  the  cost  of  the  renovation  will  be  paid 
by  the  Cleveland  Garment  Manufacturers'  Association.  This 
includes  35  concerns,  the  largest  among  the  120  in  the  city. 
The  trade  employs  about  6000  men  and  women,  about  75 
per  cent  of  whom  are  on  piece  work.  .  .  . 

The  findings  of  the  engineers  will  be  submitted  to  the 
manufacturers  and  the  union  representatives  in  occasional 
reports  during  the  study  and  as  fast  as  they  are  approved 
by  both  interests,  the  new  methods  will  be  set  in  motion. 

How  this  new  move  is  viewed  by  the  union  is  shown  by  a 
quotation  from  Perlstein,  vice-president  of  the  national  union: 

This  is  the  first  time  in  history  a  union  has  joined  hands 
with  employers  to  retain  scientific  engineers.  We  have  come 
to  a  point  where  the  old  woolly  words  and  phrases  won't  do. 
We  can't  get  anywhere  talking  about  fair  day's  pay  and  fair 
day's  work.  Nobody  knew  what  a  fair  day's  work  was,  so 
we  started  to  find  out. 

Joint  control  of  production  standards  is  what  will 
make  it  possible  for  the  union  to  accept  a  graduated  scale 
based  on  production.  The  marginal  worker  will  earn  a  liv- 
ing wage  and  the  well  trained  worker  will  be  paid  propor- 
tionately for  his  skill.  Joint  control  within  the  plant  and 
joint  supervision  of  the  time  tests  and  the  application  of  the 
engineer's  tests  will  prevent  speeding  up. 

This  statement  indicates  the  dropping  of  another  weapon 
— opposition  to  bonuses  and  graduated  wages.  It  is  now 
claimed  that  97  per  cent  of  the  clothing  of  America  is  manu- 
factured under  some  form  of  joint  management.  This  has 
been  accomplished  in  the  trade  that  but  a  short  time  ago  was 
the  synonym  for  industrial  anarchy. 

Joint  Management  in  Other  Trades 

Other  trades  are  moving  along  the  same  line.  An  inter- 
national joint  conference  council  now  governs  between  70  and 
75  per  cent  of  the  book,  job,  and  periodical  printing.  This 


3*6  PERSONNEL  RELATIONS   IN   INDUSTRY 

council  is  composed  of  delegates  from  three  employers'  organ- 
izations and  four  international  unions.  As  an  elaborate  system 
of  collective  bargaining  exists  in  this  trade,  the  council  does  not 
concern  itself  primarily  with  disputes.  The  agreement  provides 
that:  "All  conciliation  and  arbitration  processes  covered  in 
existing  agreements  must  be  exhausted  before  appeals  are 
taken  to  the  International  Council."  Some  of  the  subjects 
with  which  it  is  to  concern  itself  are  enumerated  :21 

Investigation  of  the  question  of  apprenticeship  conditions; 
adoption  of  suitable  methods  of  selection  for  apprenticeship, 
and  the  technical  training  for  apprentices,  learners  and 
journeymen  through  the  industry;  the  improvement  of 
process,  designs,  and  standards  of  workmanship ;  to  seek  ade- 
quate representation  on  the  control  and  management  of  all 
technical  institutes ;  to  consider  and  report  upon  all  improve- 
ments of  processes,  machinery  and  organization,  and  appro- 
priate questions  relating  to  management  and  the  examination 
of  industrial  experiments,  with  special  reference  to  co-opera- 
tion in  carrying  new  ideas  into  effect,  and  full  considera- 
tion of  the  employes'  point  of  view  in  relation  thereto.  The 
better  utilization  of  the  practical  knowledge  and  experience 
of  employes,  with  provision  for  facilities  for  the  full  con- 
sideration and  utilization  of  acceptable  inventions  and  im- 
provements designed  by  employers  or  employes,  and  for  the 
adequate  safeguarding  of  the  rights  of  the  designer  of  such 
improvements. 

Determination  of  practicability  of  establishing  wage  ad- 
justment boards  throughout  the  industry. 

Consideration  of  any  matters  of  general  interest  to  the 
Trade,  whether  industrial,  educative,  economic,  legislative  or 
hygienic  may  be  taken  up. 

Similar  plans  are  under  consideration  in  several  other  in- 
dustries, and  many  signs  indicate  that  the  movement  for  joint 
management  has  now  reached  a  depth  and  breadth  that  speaks 
for  growth  and  eventual  permanency. 


International  Joint  Conference  Council,  Preamble  to  Agreement. 


CHAPTER  XIX 

BRITISH  EXPERIMENTS  IN  JOINT  MANAGEMENT 

Organization  of  British  Labor 

A  remarkable  development  in  joint  management,  and  one 
carrying  many  lessons,  is  to  be  found  in  Great  Britain.  British 
labor  has  long  led  the  world  in  organization.  Here  unions 
first  gained  a  foothold,  obtained  legal  recognition,  and  rose 
to  an  established  place  in  all  industrial  relations.  Collective 
bargaining  has  long  been  the  regular  method  of  adjusting 
such  relations.  The  movement  for  the  open  shop  disappeared 
many  years  ago.  The  bargaining,  however,  has  been  of  the 
orthodox,  hostile  character.  One  result  of  this  was  a  complex 
mass  of  restrictions  upon  production.  The  day's  work  was 
stereotyped  to  suit  the  slowest  workers.  Countless  safeguards 
against  competition  barred  apprentices  and  the  partially  skilled 
from  many  trades.  Many  trade  practices  were  deliberately 
designed  to  restrict  production.  All  these  things  had  been 
built  up  by  the  unions  as  necessary  defenses  against  driving, 
rate-cutting,  underbidding,  sweating,  and  other  offensive  and 
often  production-reducing  devices  of  the  employers. 

Effect  of  War  on  Unions 

Then  came  the  war.  The  transformation  of  industry  and 
the  great  productive  exertions  demanded  by  national  existence 
were  impossible  if  the  restrictions  inherent  in  industrial  con- 
flict remained,  so  the  unions  were  called  upon  to  surrender 
their  weapons.  They  agreed  to  the  introduction  and  training 
of  new  and  unskilled  workers  for  the  "dilution"  of  the 
previously  guarded  trade  monopoly.  All  limits  on  production 

317 


3*8  PERSONNEL   RELATIONS   IN   INDUSTRY 

were  removed.    Most  significant  of  all,  they  surrendered  their 
most  effective  weapon,  the  strike. 

The  unions  charged  that  this  surrender  was  not  met  in 
the  same  spirit  by  the  employers,  but  that  these  refused  to 
raise  wages  in  accord  with  the  increased  cost  of  living,  or 
to  limit  their  profits  to  pre-war  standards.  The  unions  were, 
however,  helpless.  The  inevitable  result  followed.  Aggression 
developed  new  weapons  in  the  ranks  of  the  workers.  This 
development  brought  important  structural  changes. 

Shop  Stewards  and  Committees 

There  had  long  been  in  the  trade  union  organization  offi- 
cials known  as  shop  stewards,  selected  by  the  workers  in  each 
shop.  It  was  their  business  to  present  complaints  to  the 
management,  collect  union  dues,  and  see  that  the  terms  of 
the  collective  agreement  were  observed.  If  their  complaints 
were  unheeded  they  appealed  to  the  national  unions,  who  could 
use  the  strike  to  secure  redress.  They  had  little  other  power. 

Now  that  the  redress  for  rejected  complaints  was  removed, 
inasmuch  as  the  national  officers  of  the  unions  had  bound  their 
own  hands  by  the  agreement  not  to  strike,  it  was  natural  that 
the  shop  stewards  should  become  a  new  weapon.  They  had 
signed  no  agreement  against  striking.  Therefore  they  them- 
selves called  out  the  employees  in  thousands  of  shops  where 
strikes  were  subject  to  no  regulation.  They  crossed  the  boun- 
daries of  previous  trades.  As  they  lacked  any  responsible 
head,  they  could  not  be  suspended  by  even  such  temporary 
truces  and  agreements  as  had  hitherto  broken  class  conflict. 
The  shop  stewards,  as  the  one  powerful  expression  of  the 
fighting  instinct,  grew  rapidly  in  power.  They  came  to  em- 
body and  express  the  revolt  of  the  mass  of  workers,  not  only 
against  the  employers,  but  also  against  the  old  trade  union 
officials.  A  new  and  powerful  organization  suddenly  sprung 
up  around  the  shop  stewards — that  of  the  shop  committees. 


JOINT   MANAGEMENT   IN   GREAT   BRITAIN  3J9 

When  I  visited  England  in  the  summer  of  1918,  the  shop, 
committees  with  the  stewards  were  forming  district  and  even 
national  organizations,  and  were  rapidly  becoming  the  most 
notable  feature  in  British  industry.  This  phenomenon  on  the 
side  of  the  unions  inevitably  developed  machinery  on  the  side 
of  the  employers  to  deal  with  the  shop  committees.  A  form 
of  joint  management,  resembling  in  many  ways  the  plans 
introduced  by  American  employers,  was  put  in  operation  in 
many  industries.  The  powers  of  these  shop  committees,  and 
the  joint  committees  based  upon  them,  varied  greatly.  In 
some  instances  their  power  extended  even  to  the  election  of 
foremen.1  It  became  evident  that  these  developments  por- 
tended fundamental  alterations  in  all  industrial  relations. 

The  government  appointed  a  subcommittee  of  the  Recon- 
struction Committee:  2 

1.  To    make    and    consider    suggestions    for    securing 
permanent  improvement  in  the  relations  between  employers 
and  workmen. 

2.  To  recommend  means  for  securing  that  industrial  con- 
ditions affecting  the  relations  between  employers  and  work- 
men shall  be  systematically  reviewed  by  those  concerned, 
with  a  view  to  improving  conditions  in  the  future. 

The  Whitley  Industrial  Council  Plan 

This  committee,  known  from  the  name  of  its  chairman, 
J.  H.  Whitley,  as  the  "Whitley  committee,"  issued  a  series 
of  epoch-making  reports.3  The  central  constructive  feature 
of  these  reports  was  the  recommendation  for  a  fundamental 


'Inquiry  of  Department  of  Labor  (British)  into  Works  Committees, 
March,  1918. 

J  Report  Cd.  8606,  Mar.  8,  1917. 

*The  more  important  of  these  reports  have  been  reprinted  in  various 
issues  of  the  Monthly  Review  of  the  United  States  Department  of  Labor ; 
Bloomfield,  Industrial  Management ;  and  W.  L.  Stoddard,  Shop  Commit- 
tees. References  are  made  to  the  original  British  Reports,  of  which  the 
notes  give  numbers  and  dates. 


320  PERSONNEL   RELATIONS   IN   INDUSTRY 

transformation  of  all  British  industry  by  the  establishment 
of  a  series  of  joint  councils. 

This,  the  now  famous  "Whitley  plan,"  was  linked  with 
the  shop  committees  in  an  early  report  which  made  the  follow- 
ing observation  and  recommendation:  * 

There  has  been  some  experience,  both  before  the  war 
and  'during  the  war,  of  the  benefits  of  Works  Committees, 
and  we  think  it  should  be  recommended  most  strongly  to 
employers  and  employed  that,  in  connection  with  the  scheme 
for  the  establishment  of  National  and  District  Industrial 
Councils,  they  should  examine  this  experience  with  a  view 
to  the  institution  of  Works  Committees  on  proper  lines,  in 
works  where  the  conditions  render  their  formation  prac- 
ticable. 


In  order  to  insure  uniform  and  common  principles  of 
action,  it  is  essential  that  where  National  and  District  Indus- 
trial Councils  exist  the  Works  Committees  should  be  in 
close  touch  with  them,  and  the  scheme  for  linking  up  Works 
Committees  with  the  Councils  should  be  considered  and 
determined  by  the  National  Councils. 

The  plan  which  the  Whitley  committee  recommended,  and 
which  is  now  being  adopted  by  the  industrial  organizations 
of  Great  Britain,  provides  for  the  formation  of  "Jomt  Stand- 
ing Industrial  Councils  in  the  several  industries  where  they 
do  not  already  exist,  composed  of  representatives  of  employers 
and  employed,  regard  being  paid  to  the  various  sections  of 
the  industry  and  the  various  classes  of  labor  involved." 

The  plan  presupposes  complete  organization  on  both  sides. 
It  is  not  between  employers  and  employees  that  relations  are 
to  be  formed,  but  between  unions  and  employers'  associations. 
Only  where  such  organizations  do  not  exist,  does  the  govern- 
ment directly  intervene ;  and  then  only  to  establish  a  minimum 

4  Report  Cd.  oooi,  Oct.  18,  1917. 


JOINT   MANAGEMENT   IN   GREAT   BRITAIN  32* 

wage  and  encourage  the  formation  of  organizations.  The 
whole  thought  of  the  plan  is  to  integrate  existing  organiza- 
tions into  the  social  structure,  standardize  their  functions,  and 
assist  them  to  operate  in  an  orderly  manner. 

The  government  exercises  no  authority,  requires  no  uni- 
formity, encourages  complete  autonomy,  but  makes  the  coun- 
cils the  official  spokesmen  for  the  industry  in  recommending 
legislation.  At  the  same  time  attention  is  called  to  the  fact 
that  "the  State  never  parts  with  its  inherent  overriding  power, 
but  such  power  may  be  least  needed  when  least  obtruded." 

A  hierarchy  of  bodies  is  suggested,  with  a  national  indus- 
trial council  at  the  top  and  subordinate  district  councils  and 
works  committees.  The  methods  by  which  these  various 
bodies  are  correlated  varies  according  to  the  trade. 

Opposition  to  Compulsory  Arbitration 

Even  in  the  settlement  of  disputes,  the  committee  expresses 
itself  against  compulsory  arbitration.  It  says:  5 

We  are  opposed  to  any  system  of  compulsory  arbitra- 
tion; there  is  no  reason  to  believe  that  such  a  system  is 
generally  desired  by  employers  and  employed  and,  in  the 
absence  of  such  general  acceptance,  it  is  obvious  that  its 
imposition  would  lead  to  unrest.  The  experience  of  Com- 
pulsory Arbitration  during  the  war  has  shown  that  it  is  not 
a  successful  method  of  avoiding  strikes,  and  in  normal  times 
it  would  undoubtedly  prove  even  less  successful.  Disputes 
can  only  be  avoided  by  agreement  between  employers  and 
workers  and  by  giving  the  latter  a  greater  measure  of 
interest  in  the  industry  advocated  in  our  former  reports; 
but  agreement  may  naturally  include  the  decision  of  both 
parties  to  refer  any  specified  matter  or  matters  to  arbitra- 
tion, whether  this  decision  is  reached  before  or  after  a  dis- 
pute arises. 

For  the  same  reason  we  do  not  recommend  any  scheme 

•Report  Cd.  9099,  Jan.  31,  1918. 


322  PERSONNEL   RELATIONS   IN   INDUSTRY 

relating  to  conciliation  which  compulsorily  prevents  strikes 
or  lock-outs  pending  inquiry.  But  it  is  obviously  possible 
and  desirable  that  in  some  instances  arrangements  should  be 
voluntarily  made  in  organized  trades  for  holding  an  inquiry 
before  recourse  to  extreme  measures;  and  we  suggest  that 
the  Ministry  of  Labor  should  be  authorized  to  hold  a  full 
inquiry  when  satisfied  that  it  was  desirable,  without  pre- 
judice to  the  power  of  the  disputing  parties  to  declare  a 
strike  or  lock-out  before  or  during  the  progress  of  the 
inquiry. 

There  is  much  in  this  conclusion  of  the  British  committee 
that  is  worthy  of  the  closest  study.  It  is  the  result  of  the 
judgment  of  experienced  observers  representing  all  phases  of 
the  industrial  situation.  It  expresses  the  opinion  of  men  and 
women  who  have  observed  a  long  history  of  efforts  at  com- 
pulsory settlement  of  labor  differences. 

Constructive  Task  of  Joint  Management 

Another  helpfully  suggestive  phase  of  the  Whitley  plan 
is  its  insistence  upon  the  constructive  work  of  the  proposed 
joint  bodies.  It  is  impossible  to  overemphasize  the  importance 
of  this  point.  If  there  are  many  temporary  and  local  failures 
of  joint  management  (as  there  almost  certainly  will  be),  the 
cause  of  failure  will  usually  be  that  the  management  has  failed 
in  its  function  of  leadership  in  constructive  thought.  The 
joint  bodies  will  not  have  been  furnished  with  material  to 
act  upon.  They  will  be  left  to  growl  and  grumble  over  little 
differences,  instead  of  being  supplied  with  big  constructive 
common  problems  to  solve. 

Joint  management  will  not  function  efficiently  without  a 
good  planning  department,  any  more  than  will  a  production 
department.  If  the  employer's  side  sits  down  and  waits  for 
all  the  suggestions  to  come  from  the  side  of  labor,  it  will 
probably  receive  many  suggestions  that  it  will  not  approve. 
But  if  the  employer's  representatives  make  good  on  their  claim 


JOINT   MANAGEMENT   IN   GREAT   BRITAIN  323 

to  be  the  leaders  of  industry  by  presenting  carefully  worked- 
out  programs  for  the  improvement  of  production  and  the  con- 
ditions of  work,  they  will  enlist  the  instincts  of  craftsmanship, 
loyalty,  and  group  solidarity  on  the  side  of  joint  management 
and  produce  results  commensurate  to  the  combined  abilities 
of  the  industrial  group. 

Questions  for  Joint  Consideration 

The  Whitley  committee  realized  its  function  as  the  first 
and  temporary  general  staff  of  such  a  campaign,  and  laid 
down  a  list  of  questions  for  suggested  consideration  by  joint 
bodies.  This  list  might  well  be  posted  conspicuously,  as  a 
guide  to  policy,  in  the  plants  now  experimenting  with  joint 
management.  It  proposes  the  following  subjects:  6 

1.  The  better  utilization  of  the  practical  knowledge  and 
experience  of  the  workpeople. 

2.  Means  for  securing  to  the  workpeople  a  greater  share 
in  and  responsibility  for  the  determination  and  observance 
of  the  conditions  under  which  their  work  is  carried  on. 

3.  The  settlement  of  the  general  principles  governing  the 
conditions  of  employment,  including  the  methods  of  fixing, 
paying  and  readjusting  wages,  having  regard  to  the  need 
of  securing  to  the  workpeople  a  share  in  the  increased  pros- 
perity of  the  industry. 

4.  The  establishment  of  regular  methods  of  negotiation 
for  issues  arising  between  employers  and  workpeople,  with  a 
view  both  to  the  prevention  of  differences,  and  to  their  better 
adjustment  when  they  appear. 

5.  Means  of  ensuring  to  the  workpeople  the  greatest  pos- 
sible security  of  earnings  and  employment,  without  undue 
restriction  upon  change  of  occupation  or  employer. 

6.  Methods  of  fixing  and  adjusting  earnings,  piecework 
prices,  etc.,  and  of  dealing  with  the  many  difficulties  which 
arise  with  regard  to  the  method  and  amount  of  payment 


'  Report  Cd.  8606,  Mar.  8,  1917. 


3^4  PERSONNEL   RELATIONS    IN   INDUSTRY 

apart  from  the  fixing  of  general  standard  rates,  which  are 
already  covered  by  paragraph  3. 

7.  Technical  education  and  training. 

8.  Industrial    research    and    the    full    utilization    of    its 
results. 

9.  The  provision  of  facilities  for  the  full  consideration 
and  utilization  of  inventions  and  improvements  designed  by 
workpeople,  and  for  the  adequate  safeguarding  of  the  rights 
of  the  designers  of  such  improvements. 

10.  Improvements  of  processes,  machinery  and  organiza- 
tion and  appropriate  questions  relating  to  management  and 
the    examination    of    industrial    experiments,    with    special 
reference  to  co-operation  in  carrying  new  ideas  into  effect 
and  full  consideration  of  the  workpeople's  point  of  view  in 
relation  to  them. 

11.  Proposed  legislation  affecting  the  industry. 

Testing  the  Whitley  Plan 

This  plan  is  now  meeting  the  test  of  experience,  and,  as 
might  be  expected,  it  is  almost  nowhere  proceeding  in  the 
symmetrical  form  outlined  by  the  committee.  Each  trade  is 
adjusting  the  plan  to  its  own  problems  and  previous  history. 
This  method  of  progress  is  much  more  apt  to  insure  final 
success,  but  it  offers  little  opportunity  to  draw  broad,  general 
conclusions  at  an  early  stage.  By  the  middle  of  1920,  between 
three  and  five  million  employees  were  working  under  some 
form  of  joint  management  in  Great  Britain.  The  variation 
in  the  figures  reflects  the  variety  of  forms.  The  lower  num- 
ber represents  those  who  are  formally  registered  under  Whit- 
ley  councils.  The  higher  figure  includes  very  many  industries 
that  were  already  working  under  joint  agreements  or  have 
adopted  plans  peculiar  to  themselves,  many  of  which  closely 
resemble  the  Whitley  plan,  and  do  not  yet  care  to  change. 

The  whole  plan  is  being  subjected  to  a  most  searching 
examination,  discussion,  and  criticism,  and  tested  by  experi- 
ment such  as  always  precedes  a  great  fundamental  change  in 


JOINT   MANAGEMENT   IN   GREAT   BRITAIN  325 

industrial  organization.  It  is  significant  that  the  criticisms  are 
largely  directed  at  details,  or  are  based  upon  preconceived 
social  theories  and  panaceas,  and  are  not  directed  against  the 
general  principle  of  joint  management. 

The  Whitley  Plan  and  Building  Trades 

One  of  the  most  interesting  experiments  is  that  which  is 
being  conducted  in  the  building  trades.  These  trades  have  a 
long  history  of  collective  bargaining  and  joint  action,  are 
thoroughly  organized  on  both  sides,  and  have  a  well-trained 
leadership.  A  recent  description  of  this  plan,  which  now 
embraces  about  97  per  cent  of  the  capital  and  personnel  in 
this  industry,  says : 7 

The  Building  Trades  Parliament  consists  of  132  mem- 
bers ;  66  being  elected  by  the  22  trade  unions  of  the  build- 
ing industry,  approximately  in  proportion  to  their  numerical 
strength;  and  66  elected  by  the  17  associations  of  building 
trades  employers,  roughly  pro  rata  with  the  number  of 
operatives  normally  employed  by  their  members.  The  chair- 
man is  a  member  himself,  and  therefore  has  a  vote,  but 
not  a  deciding  vote.  No  representatives  are  appointed  by 
the  state,  the  whole  plan  being  essentially  self-government. 
It  is  the  only  industrial  council  that  has  omitted  the  word 
"joint"  from  its  title,  has  set  out  to  "realize  the  organic 
unity  of  the  industry  as  a  great  national  service,"  and  has 
the  courage  to  take  decisions  by  a  majority  of  the  whole 
council,  instead  of  requiring  a  majority  of  the  council  on 
both  sides,  which  is  the  ordinary  Whitley  council  practice. 

This  is  a  fundamental  matter.  The  Whitley  councils,  as 
at  present  constituted,  have  recognized  as  permanent  the 
very  barrier  between  the  existing  "sides"  in  industry  that 
the  industrial  parliament  scheme  was  designed  to  break  and 
that  the  Building  Trades  Council  has  already  broken,  at  any 
rate  to  some  extent. 


T  Malcolm  Sparkes,  The  Nation,  Jan.  24,  1920. 


326  PERSONNEL   RELATIONS   IN   INDUSTRY 

....  Another  feature  in  which  the  Building  Trades 
Parliament  is  unique  is  its  absolute  exclusion  of  disputes. 
Its  function  is  constructive  and  nothing  but  constructive; 
it  is  there  to  build  the  new  industrial  order,  and  for  nothing 
else.  Disputes  must  be  dealt  with,  as  heretofore,  by  the 
Building  Trades'  Conciliation  and  Demarcation  Boards 
(which  are  somewhat  similar  to  the  newly  constituted 
American  Board  of  Jurisdictional  Awards)  or  by  any  other 
methods  that  may  be  thought  to  be  advisable,  not  for  a 
moment  excluding  strikes.  Under  no  circumstances  can  the 
Building  Trades  Parliament  arbitrate;  but,  although  it  can- 
not touch  disputes  it  can  always  bring  forward  constructive 
measures  to  remove  their  underlying  cause. 

The  committee  outlines  proposals  designed  to  lay  the 
"true  foundation  for  such  a  final  consummation."  It  pro- 
poses that  the  overhanging  fear  of  unemployment,  which 
has  had  such  a  demoralizing  effect  on  both  the  character  of 
the  workman  and  the  quality  of  his  work,  shall  be  completely 
and  finally  removed,  in  order  that  he  may  whole-heartedly 
give  of  his  best.  To  secure  this  it  recommends  that  the 
industry  should  establish  unemployment  pay  for  the  whole 
of  its  trade  union  personnel,  and  that  the  necessary  funds 
should  be  raised,  as  a  first  charge  on  production,  by  means 
of  a  weekly  percentage  on  the  wage  bills,  to  be  paid  by  each 
employer  to  a  joint  committee  of  employers  and  employees. 
Although  collected  by  a  joint  committee,  the  unemployment 
pay  is  to  be  distributed  by  the  trade  unions,  in  accordance 
with  regulations  prescribed  by  the  Building  Trades  Parlia- 
ment, the  scale  varying  from  full  wages  for  a  man  with 
a  wife  and  four  children  to  half  wages  for  a  single  man. 

The  committee  then  proposes  that  the  rate  of  interest 
paid  for  the  hire  of  capital  in  the  industry  should  be  limited 
— the  scale  to  rise  and  fall  with  the  average  annual  yield 
of  the  best  government  stock — and  that  subject  to  certain 
conditions  of  approval  and  control,  it  should  be  guaranteed. 
It  further  recommends  that  all  "owner  managers"  should 
receive  salaries  "commensurate  with  their  ability,"  and  sub- 
ject to  periodical  revision  of  a  joint  committee.  And  finally 
it  suggests  that  the  surplus  earnings  of  the  industry  should 
be  publicly  declared  every  year  and  devoted  to  common 


JOINT   MANAGEMENT   IN   GREAT   BRITAIN  327 

services  controlled  by  the  industry  as  a  whole  through  its 
industrial  council.  Such  services  would  include  the  estab- 
lishment of  a  great  development  fund  for  the  industry,  from 
which  loans  could  be  obtained  by  members;  education  and 
research ;  and  superannuation  schemes  for  the  whole 
registered  personnel  of  the  industry. 

Joint  Management  of  Government  Work 

One  of  the  most  interesting  phases  of  the  Whitley  plan 
has  been  its  application  to  government  work.  The  municipali- 
ties took  it  up  quickly.  The  city  of  Bradford,  with  nearly 
7,000  employees,  including  teachers,  clerks,  and  laborers  in 
the  various  public  works,  such  as  street  cars,  gas,  electric, 
and  water  works,  established  a  council  of  32  members.  One- 
half  were  appointed  by  the  municipality  from  the  managerial 
staff  and  one-half  were  elected  by  the  respective  sections  of 
employees.  The  municipalities  have  joined  to  form  national 
industrial  councils.  Some  of  these  are  formed  by  industries; 
others  include  all  municipal  employees  not  belonging  to  trades 
covered  by  these  special  industrial  councils. 

Great  Britain.  The  British  government  is  rapidly  extend- 
ing the  plan  to  apply  to  the  entire  civil  service.  Many  diffi- 
culties are  met  with  in  this  field,  and  many  problems  remain 
to  be  solved.  The  lines  of  division  are  not  always  clear.  The 
teachers  are  discussing  how  they  can  best  sectionalize  their 
industry  so  as  to  insure  representation  and  effective  action  in 
all  grades  up  to,  and  including,  the  great  universities.  Many 
government  employees  are  already  included  in  existing  trade 
organizations  and  do  noFfit  into  the  new  schemes.  At  every 
point  new  difficulties  are  appearing  and  meeting  with  solu- 
tions, or  with  experiments  that  are  expected  to  produce 
solutions. 

France.  Other  nations  are  also  experimenting  with  plans 
of  joint  management.  Such  a  plan  was  put  into  operation 
in  France  by  Albert  Thomas  while  he  was  Minister  of  Muni- 


328  PERSONNEL   RELATIONS   IN   INDUSTRY 

tions.  Shop  committees,  known  as  delegues  des  ateliers,  were 
generally  introduced,  and  formed  the  basis  of  some  systems 
of  joint  management  that  are  still  developing. 

Canada.  In  Canada,  evolution  is  proceeding  much  the 
same  as  in  the  United  States.  There  are  shop  councils,  col- 
lective agreements,  and  the  beginnings  of  a  wider  organization 
similar  to  that  of  Great  Britain.  A  royal  commission  has 
given  unqualified  indorsement  to  the  Whitley  plan  and  urged 
the  development  of  joint  management.8 

United  States.  In  the  United  States  a  works  council  was 
introduced  into  the  Rock  Island  arsenal,  and  its  working 
highly  approved  in  a  report  of  the  Secretary  of  War.9  The 
Industrial  Conference,  of  which  the  Secretary  of  Labor,  W. 
B.  Wilson,  was  chairman  and  Herbert  Hoover  vice-chairman, 
gave  unrestricted  approval  to  joint  management  through  em- 
ployee representation  and  elaborated  a  plan  for  voluntary 
tribunals  to  co-operate  in  settling  industrial  grievances.  It 
agreed  unanimously  with  British  experience  in  opposition  to 
compulsion.  There  are  many  indications  that  the  opposition 
of  the  trade  unions  to  joint  management  is  disappearing. 

Germany.  In  Germany  there  have  been  many  schemes 
carried  partly  into  effect  looking  to  the  establishment  of  joint 
management  under  government  direction  and  control.10  The 
new  government  provided  for  the  compulsory  establishment 
of  joint  councils  in  all  industries  having  more  than  10 
employees.11 

Belgium.  Next  to  Great  Britain,  the  most  important 
developments  in  this  field  have.been  in  Belgium.  The  remark- 
able recovery  of  this  nation  after  the  war  has  been  one  of  the 

'Monthly  Labor  Review,  Sept.  1919,  pp.  19,  36-42. 
*  Industrial  Management,  Nov.  1919. 

"Monthly  Labor  Review,  Sept.  1919;  Daily  Commerce  Reports,  Sept. 
27,  1919. 

"  Monthly  Labor  Review,  Apr.  1919,  pp.  125,  126. 


JOINT   MANAGEMENT   IN   GREAT   BRITAIN  329 

most  striking  facts  of  the  reconstruction  period.  One  of  the 
fundamental  reasons  for  that  recovery,  with  its  rapid  increase 
in  production  and  absence  of  industrial  struggles,  is  found 
in  the  establishment  of  industrial  councils.12 

These  councils,  like  those  under  the  Whitley  plan,  are 
formed  directly  from  representatives  of  the  unions  and  the 
employers'  associations  in  equal  numbers.  They  differ  from 
the  British  organizations  in  the  addition  of  representatives 
of  the  government,  selected  by  the  Department  of  Industry 
and  Labor.  There  is,  however,  the  same  lack  of  uniformity 
in  details  that  everywhere  accompanies  such  a  growing  move- 
ment toward  democracy.  They  were  preceded  by  a  large 
variety  of  systems  of  shop  councils  and  governmental  bodies, 
most  of  which  are  now  giving  way  to  what  seems  to  be  the 
higher  stage  of  organization. 

The  same  result  has  followed  their  establishment  as  has 
accompanied  industrial  democracy  elsewhere.  Both  sides  show 
a  tendency  to  shed  their  weapons.  Efficiency  systems  are  being 
introduced  with  the  eager  assistance  of  the  employees.  Some 
of  the  largest  unions  have  fought  attempts  at  raising  wages, 
except  for  the  lowest  paid  workers,  on  the  ground  that  such 
action  results  in  higher  prices.  Effort  has,  instead,  been 
directed  at  reducing  prices  through  governmental  action, 
greater  efficiency,  and  co-operative  trading. 

New  View  of  the  Labor  Problem 

Joint  management  introduces  a  new,  and,  compared  with 
the  former  attitude,  a  revolutionary  view  of  the  labor  prob- 
lem, which  hitherto  has  been  looked  upon  as  a  struggle,  a 
conflict  of  forces  for  power  and  product.  The  new  attitude 
does  not  entirely  abolish  the  struggle;  it  does  not  bring  the 
millennium.  But  it  makes  the  labor  problem  fundamentally  a 

"  Henry  de  Man,  Industrial  Councils  in  Belgium,  Survey,  July  3,  1920. 


33°  PERSONNEL   RELATIONS   IN   INDUSTRY 

question  of  production  and  adjustment.  It  deals  with  imme- 
diate relations  within  the  plant,  with  improvements  in  the 
machinery  of  production,  with  greatest  emphasis  upon  the 
human  elements. 

The  result  of  focusing  attention  upon  processes,  persons, 
and  their  relations  at  the  actual  point  of  production,  is  that 
many  of  the  old  difficulties  fade  away.  Heat  gives  way  to 
light.  Conflict  is  supplanted  by  investigation  and  co-opera- 
tion. When  the  problem  of  labor  relationships  is  attacked 
in  detail,  theories,  schemes,  slogans,  symbols,  and  the  weapons 
and  passions  of  battle  give  place  to  scientific  study  and  dis- 
cussion. 


INDEX 


Accidents, 

and  safety  committees,  174 
fatigue  as  cause,  173 
relation  to  turnover,  229 
Accounting,  II 
Addams,  Jane,  "The  Spirit  of  Youth 

and  the  City  Streets,"  223 
Advertising  for  labor,  50 
Alexander,  M.  W.,  on  turnover,  229 
Allen,  C.  R.,   "The  Instructor,  the 

Man  and  the  Job,"  147 
Amar,  J.,   "The  Physiology  of  In- 
dustrial Organization,"  178 
American  Economic  Review,  38 
American  Federation  of  Labor,  281 
American  Gas  Engineering  Journal, 

230 

American  Journal  of  Sociology,  42 
American  Machinist,  97 
American     Multigraph     Co.,     joint 

management  plan,  274 
American    Shipbuilding    Co.,    joint 

management  plan,  281 
Amusement  organization,  182 
Annals  of  the  American  Academy, 
io,  37,  65,  73,  91,  99,  119,  124, 
135,  I63,  197,  229,  246,  312 
Application  blank,  61-64 
Army  personnel  system,  47 
character  analysis,  63 
classification  of  recruits,  47 
mental  tests,  88-90 
rating  system,  158 
trade  tests,  94-99 
Artistic  plant  environment,  175 
Automotive  Industries,  167,  220 
Avery,  C.  P.,  63 


B 

Earth,  C.  G.,  21,  22,  81 

"  The  Mathematics  of  Labor  Turn- 
over," 217 

Basset,  W.  R.,  "When  Workmen 
Help  You  Manage,"  119,  196, 
211,  266 

Belgium,  joint  management  in,  328 

Bell,  G.  L.,  "To  Meet  the  Changing 
Problems,"  309,  312 

Bickley,  E.  H.,  "Records  that  Match 
the  Man  to  the  Job,"  30 

Binet,  Alf.  and  Simon,  Th.,  "The 
Development  of  Intelligence  in 
Children,"  82,  83,  84,  85,  87 

Bloomfield,  D., 

"Labor  Maintenance,"  171,  246 
"Readings    in    Vocational    Guid- 
ance," 32,  57,  58 

"Selected  Articles  on  Employ- 
ment Management,"  158,  159, 
163,  319 

Bloomfield,  M.,  "Management  and 
Men,"  128 

Boardman,  H.,  "Psychological 
Tests,"  94 

Bonus  systems,  209 

Bourne,  R.  S.,  "The  Gary  Schools," 
144 

Brandeis,  L.  D.,  garment  trade 
agreement,  293,  302 

Brewer,  J.  M.,  "The  Vocational 
Guidance  Movement,"  32,  56, 
57,  67 

Bridgeport  Brass  Co.,  joint  manage- 
ment plan,  280 

Brisco,  N.  A.,  "Economics  of  Effi- 
ciency," 208 


331 


332 


INDEX 


Brissenden,  P.  F.  and  Frankel,  E., 
on  labor  turnover,  216 

British  building  trades,  joint  manage- 
ment in,  325 

Budgets  in  wage  settlements,  195 

Bureau  of  Education,  "Educational 
Tests  and  Measurements,"  94 

Bureau  of  Labor  Statistics  Bulletin, 
in,  184,  187,  188 


Colder,  J.,  on  foreman  training,  149 
Canada,  joint  management  in,  328 
Carnegie    Foundation    for    the    Ad- 
vancement of  Teaching,  20,  88 
Carr  Bros.  Hosiery  Co.,  joint  manage- 
ment plan, 275 
Chamber  of  Commerce  of  the  United 

States,  198 

Change  as  instinctive  desire,  226 
Character  analysis,  61,  70,  159,  162 
Chicago  Council,  National  Employ- 
ment Managers  Association,  156 
Chicago  sweatshop  strike,  292 
Children's    Bureau    of    the    United 

States  Department  of  Labor, 
"Standards  of  Child  Welfare,"  240 
survey  of  child  mortality,  194 
Clarke,  H.  N.,  "  Breaking  in  the  New 

Workers,"  112 

Cobb,  S.,  "Application  of  Psychiatry 
to  Industrial  Hygiene,"  184,  185 
Cohen,  J.  H.,  "Law  and  Order  in  In- 
dustry," 291,  292,  294,  296,  298, 
300,  301,  303,  304. 
Collective  bargaining,  268,  290 
Colorado  Fuel  and  Iron  Co.,  joint 

management  plan,  279,  287 
Columbia   University   mental   tests, 

100 

Colvin,    F.    H.,    "Labor    Turnover, 
Loyalty  and  Output,"  122,  131, 
1 66 
Common  law  in  industry,   309-310 


Common  sense,  78 
Commons,  J.  R.,  "Industrial  Good- 
will," 52,  53,  "5.  200,  299,  314 
Complaints,  167 
Compulsion  in  labor  relations,  242, 

321 

Concentration,  measurement  of,  92 
Conferences  for  foremen,  150 
Cooke,  M.  L.,  19 

definition  of  standard,  20 
demand  for  leadership,  135 
"The  Problem  of  American  Manu- 
facturers," 135 
Co-operative  buying,  188 
Copeland,  M.  T.,  "Business  Statis- 
tics," 27,  159,  208 
Craftsmanship,    destruction   of,    137 

(See  also  "Creative  instinct") 
Creative  instinct,  42-44 

aroused  by  quality  records,  133 
beauty,  desire  for,  134 
gratification,  elements  of,  117-120 


Democracy, 

growth  of  political,  260 

industrial,  262,  et  seq. 

planning  under,  131-133 
Demuth  Pipe  Works,  plan  of  joint 

management,  273 
Dewey,  J., 

"Democracy  and  Education,"  141, 

154 

"The  Schools  of  Tomorrow,"  3 
Dickinson,  R.,  "Using  Art  and  Type 
to  Build  Industrial  Morale,"  254 
Diemer,  H.,  "Industrial  Organization 

and  Management,"  151 
Discharges,  169 
Discipline,  16 
Drury,  H.  B., 

"Democracy  as  a  Factor  in  In- 
dustrial Efficiency,"  126 
"Scientific  Management  and  Prog- 
ress," 13 


INDEX 


333 


E 

Eastman,  G.  R.,   "Psychology  and 

Business  Efficiency,"  116 
Ebbinghaus,  H.,  92 
Education, 

defects  of  present,  142 
field  of  state,  237 
for  life  work,  143 
use  of  tests  in,  87 
within  industry,  252 
Eight-hour  day,  235 
Elliot,  C.  W.,   "The  Value  During 
Education    of    the    Life-Career 
Motive,"  57 
Ellwood,     C.    A.,     "Sociology    and 

Modern  Social  Problems,"  42 
Emerson,  H.,  "  The  Twelve  Principles 

of  Efficiency,"  203,  205,  213 
Emmet,    B.,    "Labor    Turnover    in 

Cleveland  and  Detroit,"  221 
Emotions,  rating,  162 
Employment  agencies, 
private,  51 
public,  51 

United   States   Employment    Ser- 
vice, 23,  loo,  240 
Employment  Managers'  Conference, 

50,  in 

Encyclopedia  Brittanica,  92 
Engineering  Magazine,  4 
English,  training  in,  necessary,  145 
Experience,  its  limitations,  8 


Federal  Board  for  Vocational  Edu- 
cation, 
"Employment  Management,"  248, 

257 

' '  Foreman  Training,  "151 
list  of  personnel  bulletins,  238 
make-up  and  functions,  237 
"The  Labor  Audit,"  24 
"The  Turnover  of  Labor,"   216, 

228,  229 
"Wage-Setting  Process,"  198,  210, 

250 

Federal  Trade  Commission  on  ac- 
counting, 1 1 

Feiss,  R.  A.,  "Personal  Relationship 
as  a  Basis  of  Scientific  Manage- 
ment," 73 

Filene,  A.  L.,  "  The  Key  to  Successful 
Industrial    Management,"     119 
Finanqe,  and  personnel  policy,  249 

relation  to  joint  management,  269 
Fisher,  I., 

"Humanizing  Industry,"  37 
on  fatigue  and  sickness,  177 
Florence,    P.    S.,    "Use   of   Factory 
Statistics    in    Investigation    of 
Industrial  Fatigue,"  180 
Foreman  training,  148-150 
France,  joint  management  in,  327 
Frankel,  E., 

"Labor  Turnover  in  Cincinnati," 

225 
on  labor  turnover,  216 


Factory,  27,  30,  31,  181,  211 
Farquhar,  H.,  on  monotony,  1 66 
Fatigue, 

causes  of  accidents,  1 73 

effect  of  rhythm  on,  1 79 

its  causes,  179 

laws  of,  177-179 

relieved  by  proper  posture,  172 

toxin,  179 


Galloway,  Lee,  on  training,  152 
Gantt,  H.  L., 

"  Influence  of  Executives,"  153 

on  production,  5 

"Organizing  for  Work,"  4,  6,  144, 

269 
Garment  industry, 

character,  291 

closed  shop  fight,  293 


334 


INDEX 


Garment  industry — Continued 
joint  management,  305-315 
protocol,  294,  et  seq. 

Germany,  joint  management  in,  328 

Giddings,  F.  H.,  "Principles  of 
Sociology,"  38 

Gilbreth,  F.  B.,  19,  31 

"Applied  Motion  Study,"  31,  32, 

121,    151 

Gilbreth,    F.    B.,    and    Lillian    M., 
"  Fatigue  Study,"  175 
"The  Three  Position  Plan  of  Pro- 
motion," 163 

Golden,  P.  N.,  on  trade  tests,  97 
Goldmark,  Josephine,  "Fatigue  and 

Efficiency,"  173,  180,  181 
Good-will  of  labor,  54 

gained  by  gratifying  instincts,  124 
value  of,  115 
Goodyear  Rubber  Co.,  plan  of  joint 

management,  274 

Gould,  E.  G.,  "Outline  of  Job  Analy- 
sis," 24 
Government  and  personnel  relations, 

237-243 

Government  employees  and  joint 
management,  327 

Gowin,  E.  B.,  "The  Selection  and 
Training  of  the  Business  Execu- 
tive," 7,  67,  150 

Great  Britain,  joint  management  in, 
317-327 

Gregariousness  (See  "Group  in- 
stinct") 

Group  instinct,  38 

effect  on  new  employees,  103,  104 
in  machine  industry,  42,  116 
leadership  in,  134 

Groves,  R.  A.,  "Sociology  and 
Psycho- Analytic  Psychology," 
42 


Hall,  G.  S.,  "Adolescence,"  103,  224, 
226 


Harrison,  G.  C.,  "Cost  Accounting  to 
Aid  Production,"  19,  205,  244 

Hart,  H.,  "Fluctuations  in"  Unem- 
ployment," 243 

Hart,  Schaffner  and  Marx, 

"Labor  Agreement,"  306,  307,  310, 

3" 
plan  of  joint  management,  305-308 

Hartness,  "  The  Human  Factor  in  In- 
dustry," 92 

Hathaway,  H.  K.,  212 

Health  care,  183-186 

Heilman,  R.  E.,  "Do  You  Keep 
Your  Men  too  Long,"  232 

Hillman,  Sidney,  312 

History  of  industry  and  interest,  121 

"History  of  the  Personnel  System  of 
the  United  States  Army,"  47, 
64,  65,  72,  88,  90,  94,  95,  96,  97, 
98,  158. 

Hobart,  H.  C.,  on  promotion  and 
transfer,  156 

Hobson,  J.  A.,  "Work  and  Wealth," 

117,  2OI 

Hollingworth,  H.  L., 

and   Poffenberger,   "Applied   Psy- 
chology," 34 

"Vocational  Psychology,"  27 
Hood  Rubber  Co.,  151 
House  organ,  254 
Housing,  1 88 
Howard,  E.  D.,  310 
Hoxie,  R.  P.,  13,  210,  211 
Human  element  in  industry,  14,  33 
Human  nature, 

definition,  35 

effect  of  environment,  233 

personnel  director  is  judge  of,  256 
Hydraulic  Pressed  Steel  Co.,  254 
Hygiene  in  plant,  186 


Illinois  Health  Insurance  Commission 

Report,  72,  187 
Illinois  Law  Review,  310 


INDEX 


335 


Illinois  Steel  Co.,  174 
Immigration,  237 

Impartial  chairman  in  garment  agree- 
ment, 307 

Incentive  and  learning,  106 
Industrial  history,  121 
Industrial  Information  Service,  186, 

190,  242 

Industrial  Management,  19,  112,  185, 

217,    226,    239,    244,    270,    328 

Industrial   research,    238     (See   also 

"Research") 

Infant  mortality  and  wages,  194 
Instincts,  36-44 

definitions,  37 

directing,  41 

functions,  37 

origin,  37 

relation  to  industry,  42,   117,   118 

slowness  of  change,  38 

sublimation,  41 
Insurance,  186 

Integrating  worker  and  industry,  123 
Intelligence, 

according  to  trades,  93 

curve,  90 

definitions,  84-86 

grades  in  army,  88 

measurement,  83 

Interesting  labor  in  industry,  114-136 
International    Harvester   Co.,    joint 

management  plan,  279 
International  Joint  Conference  Coun- 
cil of  Printing  Trades,  316 
International  Labor  Conference,  236 
International  Ladies'  Garment  Work- 
ers, 314 
International  relations  of  industry, 

233-237 

Interviewing,  66,  71 
Introducing  employees,  15,  103-113 
Intuition,  69 
Invention, 

basis  of,  141 

methods  of  arousing,  125 


Iron  Age,  24,  156,  159,  289 
Iron  Trade  Review,  149 


James,  W.,  "The  Principles  of  Psy- 
chology," 37,  43,  77,  86,  104 

Job  analysis,  24-29 
definition,  23 

of  personnel  director's  job,  255 
specification,  25 
standardization,  31 
value,  27 

Job  specification,  29 

Job  survey,  23 
neighborhood,  49 

Joint  committee  on  complaints,  168 

Joint  management,  265,  et  seq. 

adjustment  of  disagreements,  286 

American  Multigraph  Co.,  274 

American  Shipbuilding  Co.,  281 

Belgium,  328 

Bethlehem  Steel  Co.,  279,  281 

Bridgeport  Brass  Co.,  280 

British  Building  trades,  325 

Canada,  328 

Carr  Brothers  Hosiery  Co.,  275 

Colorado  Fuel  and  Iron  Co.,  279, 

287 

departmental   representation,    279 
effect  on  management,  283 
effect  on  workers,  285 
France,  327 

Goodyear  Rubber  Co.,  274 
government  employment,  327 
International  Harvester  Co.,  279 
Leitch  plan,  273-275 
national  clothing  trades,  308 
Nunn-Bush  Shoe  Co.,  279,  287 
Philadelphia   Rapid    Transit   Co., 

1 80,  280,  287 
printing  trades,  315 
qualifications  for  voters,  287 
relation   to   collective  bargaining, 
268,  290 


336 


INDEX 


Joint  management — Continued 

relation  to  production,  288 

scope  of,  267 

types,  279 
Jones,  E.  D., 

"Administration  of  Industrial  En- 
terprises," 151,  206,  210 

"Business  Administration,"  6,  9 
Journal  of  Applied  Psychology,  91,  94 
Journal  of  Educational  Psychology, 

94 
Journal  of  Industrial  Hygiene,  185 


Kansas  Court  of  Industrial  Rela- 
tions, 242 

Kelly,  R.  W.,  "Training  Industrial 
Workers,"  137,  151,  159 

Kelly,  T.  L.,  "Principles  Underlying 
the  Classification  of  Men,"  91 

Kemple,  F.,  "Choosing  Employees 
by  Mental  and  Physical  Tests," 
62 

Kent,  R.  T.f  92 

Kpof,  H.  A.,  "Report  on  Job  Analy- 
sis," 27 


Labor  Audit,  24 

Labor  manager  in  clothing  trade,  310 

Labor  policy,  importance  of,  247 

Labor  reserve,  52 

Labor  supply,  15 

classification,  47 

cross-section,  46 

neighborhood  survey,  49 

schools  as  sources,  55 

standardization,  45 
Leadership,  134 
League  of  Nations,  234 
Learning      (See     also     "Training," 
"Education") 

incentives,  106 


Learning —  Continued 
law  of,  105 
plateau,  105 
Leffingwell,  W.  H.,  "Scientific  Office 

Management,"  13,  210 
Leiserson,  W., 

on  labor  policy,  247 

"Organizing  the  Working  Force," 

270 
Leitch,  J.,  273 

"Background  of  Industrial  Demo- 
cracy," 277 
plan  of  industrial  organization,  273- 

275 

profit-sharing  scheme,  275 

Lescohier,  D.  D.,  "The  Labor  Mar- 
ket," 52,  240 

Libido,  40 

Libraries  for  employees,  190 

Light  for  work,  172 

Link,  H.  C.,  "Employment  Psychol- 
ogy," 9,  14,  26,  27,  71,  86,  93, 
102,  148,  160 

Litchfield,  P.  W.,  "Employees  Who 
Govern  Themselves,"  274 

Loeb,  Jacques,  "Comparative  Phys- 
iology of  the  Brain,"  37,  85 

Long,  Constance,  "An  Analytic  View 
of  the  Basis  of  Character,"  40 

Lott,  M.  R.,  "Standardizing  the 
Job,"  27,  31 

Love,  J.  W.,  "Teamwork  in  the 
Cleveland  Garment  Industry," 
209,  314 


M 


Machine  industry, 

mental  demands,  139-141 
relation  to  youth,  224 
Man,  H.  de,  "Industrial  Councils  in 

Belgium,"  329 

Mann,  C.  R.,  "A  Study  of  Engineer- 
ing Education,"  88 


INDEX 


337 


Marot,  Helen,  "Creative  Impulse  in 
Industry,"  118,  126 

Massachusetts  Institute  of  Tech- 
nology, 152 

McCormick,  C.  H., 

"Co-operation  and  Industrial  Prog- 
ress," 284 
on  industrial  democracy,  263,  284 

McDougal,  Win.,  "Social  Psy- 
chology," 36,  37 

Mechanical  Engineering,  5,  174,  212 

Mellon  Institute,  152 

Mental  tests     (See  "  Tests  ") 

Miller,  W.  S.,  87 

Minimum  wage  law  in  the  District  of 
Columbia,  241 

Monotonous  work, 
effect  of  training,  165 
mentally  dull  in,  93 
methods  of  relief,  124-125 

Monthly  Review  of  the  Bureau  of 
Labor  Statistics,  183,  185,  216, 
221,  225,  236,  247,  328 

Moses,  J.  M.,  312 

Munsterberg,  H.,  "Psychology  and 
Industrial  Efficiency,"  34,  62 


Nation,  325 

National  Association  of  Corporation 
Schools,  22,  27,  55,  109,  152, 

174.  251 

National  Industrial  Conference 
Board,  "Works  Council  Manu- 
al, "271,  277 

National  Industrial  Federation  of 
Clothing  Manufacturers,  308 

Neighborhood  survey,  49 

Nervous  disorders  in  industry,  185 

New  Republic,  285 

Noise,  173 

Non- Partisan  League,  261 

Nonsense  syllables,  92 

Nunn-Bush  Co-operative  Association, 
279,  287 


Orders  in  training,  151 

O'Shea,  P.  F.,  "  Securing  Quality  by  a 

Bonus,"  211 
Overwork,  177 


Packard  Motor  Car  Co.,  promotion 

system,  166 
Parker,  C.  H.f 

"Casual  Laborer  and  Other  Es- 
says," 42 

"Motives  in  Economic  Life,"  38 
on  instincts,  39 

Parkhurst,  F.  A.,  "Applied  Methods 

of  Scientific  Management,"  151 

Parmalee,  M.,   "Science  of  Human 

Behavior,"  37,  43 

Parsons,  F.,"  Choosinga  Vocation,"62 
Payment  by  results,  201-203 
Performance  tests,  96 
Person,  H.  S., 

"Scientific  Management,"  208 
"Training    of    the    Employment 

Executive,"  246 
Personnel  director, 
as  arbitrator,  167 
position  in  organization,  247-251 
qualifications,  246,  255-258 
relation  to  training,  148 
"Personnel    System    of    the    United 
States    Army"     (See   "History 
of  the  Personnel  System  of  the 
United  States  Army") 
Personnel  relations,  elements  of,   14 
Philadelphia  Rapid  Transit  Co.,  280, 

287 

"  The  Co-operative  Plan,"  280 
Physical  examinations,  72,  252 
Physician  in  industry,  184 
Physiognomy,  66-68 
Piece-rate  wages,  199-200 
Pillsbury,  W.  B.,  "The  Psychology  of 
Nationality     and     Internation- 
alism," 37 


338 


INDEX 


Plant  location  and  labor,  48 
Plateau  of  learning,  105 
Poffenberger,  A.  T.,  "Applied  Psy- 
chology," 34 
Polakov,  W.  M.,  on  profit-sharing, 

212 

Policy  book,  109 

Political  economy,  17 

Preferential  union  shop,  296 

Printers'  Ink,  254 

Printing    trade,    joint    management 

plan,  315 
Production, 

function  of  industry,  3 

pleasure  in,  118-124 

relation  to  personnel  work,  4 

standards,  16 

under  joint  management,  288 
Profit-sharing,  212-213 
Progress,  method,  6-7 
Promotion,  1 6 

basis,  156,  161 

planning,  163 

rating  for,  157-161 

"Three  Position  Plan,"  164 
Psychiatry  in  industry,  184 
Psycho-analysis,  80 
Psycho-Analytic  Review,  40 
Psychology, 

associationist,  78 

behavioristic,  35 

contribution  to  personnel  science, 
18 

faculty,  77 

recent  developments,  34,  79 

value  in  industry,  116 
Purchasing  system,  12 
Purinton,  E.  E.,  "  Personal  Efficiency 
in  Business,"  173 


Quality, 

bonus,  211 

competition,  133 
Quarterly  Journal  of  Economics,  210 


R 

Rating  systems,  157-160 

for  emotions,  162 
Records,  16,  54,  161 

use  in  transfers  and  promotions, 

155 

Recruiting  labor,  53-56 

Redfield,  W.  C.,  "  The  New  Industrial 
Day,"  197 

References,  64 

Research, 

co-operation  with  educational  in- 
stitutions, 152 
in  industry,  253 

Restaurants  in  plants,  187 

Rhythm, 

in  human  body,  179-180 
measurement,  92 

Richards,  C.  R.,  "What  We  Know 
about  Occupations,"  32 

Rittenhouse,  E.  E.,  on  nervous  strain, 
176 

Rock  Island  arsenal,  joint  manage- 
ment in,  328 

Ruml,   B.,   "Selective  Tests  in   In- 
dustry," 91,  99 

Rust,    E.    G.,    "Centralization    vs. 
Decentralization    in    Industrial 
Management,"  10,  124 
on  exceptional  men   in  industry, 
II 


S 


Sales  and  labor  policy,  248, 269 
Sanitation,  172,  296 
Schneider,   H.,   "Education  for  In- 
dustrial Workers,  "138 
School  Review,  87 
Schools, 

functions,  3 

new  developments,  143 

source  of  labor,  55 

use  of  mental  tests,  87 


INDEX 


339 


Science, 

applied  to  personnel  relations,  13 
contributions,  17 
defined,  6 
in  purchasing,  12 
labor  saver,  9 
relation  to  democracy,  264 
valuable  characteristics,  7 
Scientific  American,  104,  263,  284 
Scientific    management     (See    also 

"Time  and  Motion  Study") 
effect  on  turnover,  228 
essentials,  205-207 
in  cutting  metals,  21 
in  office  work,  13 
in  personnel  work,  258 
relation  to  democracy,  264 
vs.  strenuousness,  208 
wrong  attitude,  127 
Scott,  W.  D.,  on  reference  form,  65 
Selection    of    employees,     15     (See 

also  "Tests") 
Separations,  169 

Shefferman,   N.   W.,   "Employment 
Methods,"    156,    159,    188,    246 
Shop  clerks,  297 

Shop  committees     (See  "Joint  Man- 
agement") 
Shop  stewards,  318 
Simmons,  W.  B.,  "More  Applicants 

than  Jobs,"  53 
Skill,  96, 221 

Slichter,  S.  H.,  "The  Turnover  of 
Factory  Labor,"  24,  65,  66,  69, 
71,  106,  108,  ill,  149,  159,  167, 
214,  221,  227,  230,  231 
on  foremen,  149 
on  interest  in  work,  228 
on  job  analysis,  25 
on  references,  65 
Sociology,  1 8 

Southard,  E.  E.,  "The  Mental  Hy- 
giene of  Industry,"  185,  226 
Spanish  River  Pulp  and  Paper  Co., 


Sparkes,  M.,  325 
Special  Libraries,  190 
Spencer,  H.,  76 
Standards, 

and  civilization,  19 

basis  of  science,  9 

budget  for  wages,  195 

definition,  20 

interview  questions,  71 

labor  savers,  20 

method  of  formation,  21 

of  army  tests,  95 

of  job  analysis,  30 

of  labor  supply,  45 

of  mental  tests,  81 

of  wages,  203 

Statistical  departments,  244 
Stern,  L.  W.,  "Psychological  Meth- 
ods   of    Testing    Intelligence," 
81,  83,  85,  90,  91,  94 
Stoddard,  W.  L.,  "The  Shop  Com- 
mittee," 276, 282,  319 
Stone,  N.  I.,  on  wages,  197 
Suggestions, 

and  training,  154 

under  joint  management,  267 
Supermen,  10 
Survey,  197,  209,  309,  329 
Swan,  J.  J.,  "Army  Trade  Tests,"  100 
System,  53,  232,  274 


Taylor,  F.  W., 

"Art  of  Cutting  Metals,"  21 
"Government  Efficiency,"  206 
"Principles  of  Scientific  Manage- 
ment," 10,  12,  21,  81,  127,  129, 

212,  222 

Taylor  Society,  Bulletin  of,   13,  21, 
49,  92,  131,  132,  155,  166,  194, 
198,  206,208,211,212,215 
Taylor  system, 
early  defects,  127 
opposition  of  labor,  128 
task  system  in,  212 


340 


INDEX 


Tead,  O., 

"  Criticism  of  the  Whitley  Report," 

285 

"  Instincts  in  Industry,"  37,  42 
Tests,  75-102 

Binet-Simon,  80,  87 
evolution,  80-83 
mental,  77-93 

army,  88-89 

grading  by,  84 

in  education,  87,  88,  100 

in  industry,  90-93 
methods  of  applying,  82 
necessity  of,  76 
trade,  93-100 

developing  in  interviewing,  71 

for  executives,  loi 

performance,  98 

preparation,  95 

requirements,  94 
Thomas,   W.   I.,    "Source   Book  of 

Social  Origins,"  103 
Thompson,    G.     B.,    "Relation    of 

Scientific  Management     to  La- 
bor," 210 
Thompson,  S.  E.,  "Time  Study  and 

Task  Work  Explained,"  208,  211 
Thorndike,  E.  L., 
"The  Original  Nature  of  Man," 

35,  37,  39,  4<> 

"The  University  and  Vocational 

Guidance,"  58 
"Theory    of    Mental    and    Social 

Measurements,"  94 
Time  and  motion  study,  13,  207 
arouse  interest,  121 
under  joint  management,  312-315 
Titchener,  T.  B.,  "  Text-Book  of  Psy- 
chology," 78,  79 
Trade  board   in   garment   industry, 

307,  3U 

Trade  tests     (See  "Tests") 
Training,  15,  137-154 
and  "blind  alley"  jobs,  165-166 
during  introduction,  in 


Training — Continued 

effect  on  labor,  152 

foreman's  place  in,  148 

general  plant,  250 

necessity  for  systematic,  144 

organization,  147 
Transfers,  155,  161 
Trial  and  error  in  business,  75 
Turnover,  214,  et  seq. 

among  unskilled,  221 

among  young,  223-225 

analytical  table,  217-219 

and  accidents,  229 

and  illiteracy,  222 

and  inefficiency,  230 

calculating,  214-216 

cost,  229 

deeper  social  causes,  243 

Frankel,  E.,  on,  216 

psychology,  226 

reducing,  231 

relation  to  interest  in  work,  220 

relation  to  length  of  service,  220 


Unemployment, 
extent,  243 
legislation,  236 
under  "protocol,"  301 
whip  to  labor,  114 
Unions, 

and  piece-work,  169 

and  wages,  193 

contributions  to  joint  management, 

290,  et  seq. 

in  Great  Britain,  317-327 
U.  S.  Army  personnel     (See  "His- 
tory of  the  Personnel  System  of 
the  United  States  Army") 
U.  S.  Bureau  of  Education,  100 
U.   S. .  Bureau  of  Labor  Statistics, 

50,  181,  184,  187,  188 
U.  S.  Department  of  Labor, 

investigation  of  garment  industry, 
298 


INDEX 


341 


U.   S.   Department  of  Labor — Con- 
tinued 

method  of  calculating  turnover,  215 
on  turnover  in  Detroit,  220 
work  of,  239 

U.  S.  Employment  Service, 
mobilizing  war  labor,  240 
standards  of  trades,  23 
trade  tests,  100 
U.  S.  Public  Health  Bulletin,   174, 

1 80,  184,  240 

U.  S.  Shipping  Board  Bulletin,  248 
U.  S.  Tariff  Board  report  on  Pulp  and 
News-Print  Paper  Industry,  197 
University  of  Minnesota  High  School, 
87 


Valentine,  R.  G., 

on  personnel  director,  255 
"Scientific  Management  and  Or- 
ganized Labor,"  49 
Veblen,  T.,  "The  Instinct  of  Work- 
manship," 9,  43,  103,  142 

W 

Wages,  16 

and  budgets,  195 

bonus  systems,  209 

effect  on  infant  mortality,  194 

high  cost  of  low,  195-197 

minimum,  195 

piece,  199 

relation  to  profits,  250 

standards,  203 

theories,  192 

under  scientific  management,  206- 

211 
War  Industries  Board,  job  analysis, 

24 
Ward,  L.  F.,  6 


Watson,  J.  B.,  "Psychology  from  the 
Standpoint  of  a  Behaviorist," 
37,  38,  41,  43,  69,  106,  162,  179 

Webb,  S.,  "The  Works  Manager  of 
To-day,"  193,  199,  201 

Welfare  work,  171-191 

introducing    employees,    no,    112 

Whipple,  G.  M.,  "Manual  of  Mental 
and  Physical  Tests,"  82,  94 

White  Motor  Co.,  promotion  system, 
1 66 

Whitley,  J.  H.,  319 

Whitley  plan  of  joint  management, 

319-324 

Whitley  reports,  319,  320,  321,  323 
Wigmore,  J.  H.,  310 
Wiseman,  M.  H.,  "  Keeping  the  Peace 

with  Labor,"  239 
Wolf,    D.,    "Shop    Committees   and 

Stimulated  Production,"  289 
Wolf,  R.  B., 

on  democratic  planning,  131-133 
on  quality  bonus,  212 
"Works  Council  Manual,"  271,  277 
Works    councils      (See    also    "Joint 

Management ") 
powers,  282 

principles  of  organization,  271 
Wundt,   W.,    "Lectures  on   Human 
and  Animal  Psychology,"  37 


Yerkes,  R.  M.,  "A  Point  Scale  for 

Measuring  Ability,"  94 
"Army  Mental  Tests,"  94,  239 
Yoakum,     C.     S.,     "Army    Mental 

Tests,"  239 
Young,  A.  H., 

"Address    to    Safety    Engineers," 

230 

"Industrial  Personnel  Relations," 
5,  174 


Date  Due 


JAN  5   '56 


•w- 


JON  5 


UC  SOUTHERN  REGIONAL  LIBRARY  FACILITY 


AA  000058819  4 


HF55U9 


Simons ,  A.M. 

Personnel  relations  in 
industry. 


